Private equity players are returning to the Indian real estate market with gusto.A proprietary investment arm of JP Morgan will take 50% stake in a Rs 1,500 crore joint venture with Nitesh Estates for developing residential projects in Bangalore.
The JP Morgan Fund will invest $40 million,or Rs 200 crore,as equity into the special purpose vehicle (SPV) developing five projects,said banking sources familiar with the matter.The company can raise debt based on the equity infusion.
When contacted Nitesh Estates executive director L S Vaidyanathan,he declined to comment on the development.
The JV between JP Morgan and Bangalore-based Nitesh Estates will be developing over 5 million sft of living space with the projects valued around Rs 1,500-2,000 crore.This will be the fourth private equity investor in Nitesh Estates.
The firm has cut deals with New-York based Och-Ziff Capital Management Group,Apollo Management and HDFC in the past.Och-Ziff,a global hedge fund which bought 25% stake in the company for $51 million in 2007,has part-exited the company and currently holds 8% in the Bangalore realty firm.
Apollo holds 74% in a JV that is developing India's first Ritz Carlton hotel,which is scheduled to open in mid-2012.The luxury property coming up on Residency Road with a developable area of 0.50 mn sft will have 281 keys.The firm has recently signed a joint development agreement to develop a Rs 300 crore residential project on the Sarjapur-Outer Ring Road stretch in Bangalore.The 4-acre project with 9-lakh sft of development is aimed at mid and upper income segments.
The realty player with a significant exposure in the residential space is shoring up its retail presence.
The firm is developing Nitesh Mall in Indiranagar with a developable area of 1.11 mn sft.The mall designed by Seattle-based architecture firm Callison will open in 2014.
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