DDA earns Rs 980 cr from auctions

Parsvnath Developers hopes to gain from acquisition of 7,232.8-sq-m plot in Rohini.

Following a successful listing on the Bombay Stock Exchange last month, Parsvnath Developers is looking to gain from yesterday's acquisition of a 7,232.8-sq-mt plot meant for retail and office space in the capital's Rohini area.

At the two-day auction that ended today, the Delhi Development Authority (DDA) garnered approximately Rs 980.3 crore from the sale of 24 commercial properties across the capital, that had a reserve price of Rs 623.43 crore. Eleven properties were not sold.

Parsvnath paid Rs 231 crore for the site in Rohini, beating the reserve price of Rs 87.17 crore by 165 per cent. It plans to build a shopping mall at the site and also contemplates building office space on top floors.

Given the lack of authorised retail and commercial space in Delhi and the sealing drive being undertaken by the Municipal Corporation of Delhi, Parsvnath's profit margin for this deal can be best judged by the price paid for the plot.

The total built-up area permitted at the site is close to two lakh sq ft and Parsvnath paid just under Rs 12,000 per sq ft of built-up space.

"Prices of shops in Rohini have today increased to Rs 25,000 per sq ft. Given these prices, there is enough margin for Parsvnath to make a profit," said Pankaj Renjhen, regional director, Trammel Crow Meghraj.

The Ambience group paid Rs 120 crore, more than double the reserve price of Rs 57.22 crore, to acquire a 4106.9-sq-m plot meant for office space in Rohini. The company shelled out Rs 2.09 lakh per sq mt for the site.

The Ambience group also purchased a 5,610-sq-m site in Shalimar Bagh for Rs 101 crore, almost double the reserve price of Rs 54.91 crore. MGF acquired a 6,216-sq-m plot in Shalimar Bagh for Rs 58.1 crore.

"The sealing is obviously impacting prices at auctions. Compare this with the auctions held three years ago when we would only sell two or three plots out of the 25 sites for auction," said Pankaj Kumar, deputy commercial land officer, DDA.