The first project is 'Cloud 9' at Vaishali, which is in the advance stage of execution and the second is an upcoming project 'Hindon Green Valley' at Indirapuram. The group is developing 1.4 million sq ft in Vaishali and 1.5 million sq ft in Indirapuram.
It is learnt that the total facility of Rs 100 crore shall be utilised partly for the payment to Ghaziabad Development Authority as well as towards the construction. When contacted, Atul Dev Paul, general manager, operations, Rishab Group, said: "the information you have is correct and confirmed." A mail sent to L&T Finance senior executive did not elicit any response.
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Sway Financial Advisors (SFA) is the sole advisor to the group for this deal.
Debt funding is picking up in NCR for construction of property projects. Recently, Business Standard reported that Piramal and Axis Bank invested Rs 550 crore in the mixed use project of the 3C company.
Earlier in June this year, real estate developer Saya Group raised Rs 200 crore in the form of a term loan from financial services firm Edelweiss to fund an ongoing housing project at Ghaziabad. As per the sources, the L&T Finance-Rishabh deal is believed to be struck at 25-30 per cent lower cost the than Edelweiss-Saya deal.
However, in a recent report, rating firm Crisil has claimed that developers are raising funds at expensive rates from private equity companies.
Further, the rating agency added that Crisil said that the country's top 25 property developers, which account for nearly 95 per cent of market capitalisation in the real estate sector, are likely to face risks in refinancing about Rs 30,000 crore of debt.