UK company to invest $1 bn in Indian realty
Europe's MPC decides to invest in residential projects and commercial properties, reports Arun Kumar.Updated: Jul 06, 2007 01:40 IST
MPC Synergy Real Estate, joint venture between the Germany-based MPC Capital AG and Switzerland based -- Swiss Synergy Asset Management – has decided to invest $1 billion in Indian real estate industry over the next 18 months.
The company will invest in residential projects and commercial properties including those in the retail and hospitality sectors, said Axel Schroeder, chief executive officer of MPC Capital.
The company has already formed a joint venture with Escorts group scion Anil Nanda's Akme Projects to invest $200 million in three residential complexes to be built in Bangalore, Mohali and Ludhiana.
"We have already acquired the land for these projects and the construction will start shortly. The projects envisages building 6 million square feet to be completed in three years," said Schroeder.
The German-listed MPC Capital is already in discussions with some of the leading playes in the hospitality sector as well as in the commercial and retail space. "We are hopeful to start these projects shortly," Schroeder said.
Nanda, Akme's managing director, said there are many projects in the pipeline and his company was evaluating their viability. "We are hopeful to doing more projects with them," he added.
MPC, which has invested in seven global markets including the United States, Canada, The Netherlands, Austria, Germany, Portugal and Britain and has an asset base of $18.5 billion feels that the Indian real estate story has just begun.
It will continue to give a reasonable return of 15 per cent after adjusting costs and taxes for medium to long term, said Ulrich Oldehaver, board member at MPC Capital.
India is in a stage of fast economic growth and commensurately its growing need for real estate contrasts with an underdeveloped capital market for funding real estate projects.
In the next five years approximately 55 million square metres of new office space needs to be completed in the high quality office space segment alone. By 2010, analysts expect some 600 new shopping centres to be opened in India.
First Published: Jul 06, 2007 01:23 IST