HDFC fund buys 45% in Lodha project

An international fund backed by HDFC has picked up 45 per cent stake in Mumbai-based developer Lodha group's realty project in Hyderabad for Rs 250 crore.

Lodha Group bought 12.9 acres at Eden Square, Hyderabad, from the Andhra Pradesh Housing Board for Rs 256 crore. The total project cost is nearly Rs 920 crore.

REALTY BOOM

HDFC-backed fund invests Rs 250 cr in Rs 920-cr Lodha project.

Saffron Group invests Rs 186 cr in Parsvnath Developers, involved in a Rs 620-cr bus depot project in Mumbai.

The group plans to develop a luxury township of 2.5 million sq ft of plush residential and commercial real estate on the land. Trustcap, a Mumbai-based investment banking company, advised Lodha on the transaction.

The group has raised Rs 2,400 crore from private equity players in the last two years and this is the fourth private equity investment in the company. In September 2007, Deutsche Bank Singapore invested Rs 1640 crore ($410 million) in three projects of the group.

Another investment major JP Morgan invested Rs 274 crore in Lodha Bellissimo "� a luxury residential project coming up at Apollo Mills, located at southcentral Mumbai.

Abhinandan Lodha, director, Lodha Group, said, "We continue to need capital for our projects. We will look at private equity funding in the next six months and then think of capital markets in the next 15-24 months,'' he said.

Lodha is developing nearly 27 million sq ft of real estate and owns 6,000 acres of land bank in the country.

A host of global private equity players, including Blackstone, Citigroup, Morgan Stanley and Tishman Speyer and domestic funds of ICICI, Kotak and HDFC, has committed or invested nearly Rs 20,000 crore ($5 billion) in the Indian realty sector in the last two years.

The renewed interest of private equity funds in the country's realty sector can be attributed to returns in excess of 25 per cent provided by Indian properties and the stagnant nature of developed markets, according to estimates.