How FAR would the state govt go to grant Infosys its wish

The IT giant which has acquired 300 acres of land for expansion in Sarjapura has made an application to the govt to hike the Floor Area Ratio for the campus. The existing FAR in that particular region %is 0.5, but Infy wants it raised to 2.

The state government is in a fix. It has to deal with a high-profile 'request', complying with which could involve bending the zonal regulations for a singular case.

Infosys Technologies which has acquired around 300 acres of land for its IT expansion in Sarjapur has made an application to the government to increase the Floor Area Ratio (FAR) for the campus. The existing FAR in that particular region is 0.5, but Infy wants a 2 FAR.

Having passed through Industries and Commerce Department and Urban Development Department, the proposal has now reached the Bangalore Metropolitan Region Development Authority (BMRDA) for its review.

The babus are a divided lot over the issue. One section sees no harm in giving in to Infy's request as there “can always be a via-media to relax any rule legally.” But qualified town planners are dead against making an exception for one company.

With other areas of Bangalore saturated with development, and with empty spaces constantly shrinking, the Anekal-Chandapura region is touted as the destination next for software companies, realty projects and commercial development. As many as 70 infotech companies are located within a radius of about 16 km from Chandapura circle.

Just 12 km from the circle, on the Sarjapura-Attibele Road, Infosys has acquired a 300-acre land for its next expansion. The area comes under the jurisdiction of Anekal Local Planning Area, which has 170 villages under 

its purview.

Infosys is waiting for a positive response from the government. Bangalore Mirror mailed its queries to Infosys on Thursday, and in the response received on Friday, Ramadas Kamath U, senior vice-president, head of Infrastructure, commercial, facilities, administration and security, and V Balakrishnan, member of the Board stated: “Yes, we have made an application to the state government to relax the FAR norms for Sarjapur as the land is costlier and availability is very limited. So far we have not heard anything from the government. Hope they will consider the request.”

PE offers 560 cr for part of UB City

Blackstone Deal May Be Part Of Plan To Recapitalize KFA 

Private equity giant Blackstone has made a Rs 560-crore offer to acquire the rent yielding real estate assets of Vijay Mallyas investment company UB Holdings,the promoter of the grounded Kingfisher Airlines,said sources directly aware of the matter.The deal may be part of the companys plans to recapitalize the airline in which it holds a little more than 24% stake.

The joint offer from Blackstone and technology park developer Embassy Group both have an equal joint venture to acquire office buildings falls slightly short of the asking price and is pending final negotiations.The deal could see Mallya offloading 3.60 lakh sq ft of tenanted office space and 60,000 sq ft of luxury retail thats part of UB City,a 1.6 million mixed use project still under development in the heart of Bangalore.The transaction will not include UB corporate offices and the branded ultra-high end Kingfisher residences.

TOI  first reported in May this year that PE biggies,including Blackstone,were evaluating a deal involving real estate business of UB Holdings.

A top UB executive confirmed Blackstone formal bid but added the company has received more than one offer.Sources said another suitor in the fray was southern developer RMZ Corp,backed by baring Private Equity Partners India.

Blackstone may be the front runner even though UB top brass held meetings with RMZ last week.A Blackstone spokesperson declined to comment on speculation. Mallya told TOI he was not aware of any such offers since nothing has come up for his consideration.

Sources said Blackstone offer may be a structured transaction,with the PE financing the deal through a special purpose vehicle of the Embassy Group.This would help Blackstone circumvent FDI restrictions,which are likely to crop up.

UB City is a joint venture between Mallyas UB Holdings and Prestige Developers,in which he has 55% share of the developed space.Some of the big corporate names occupying office spaces in UB City include 3M,Apple,Citibank,Ernst & Young,Toyota,Kawasaki and Yahoo.

At present UB City commands office rental rates of Rs 120 to Rs 130 per sq ft and retail rental rates of about Rs 250 to Rs 300 per sq ft,giving annualized return on rental incomes of about 11-13 %.Last month,Blackstone sunk Rs 1,015 crore for a significant minority stake in Pune Dynasty Projects,a special purpose vehicle (SPV) in which Embassy holds three of its FDI-compliant commercial business parks,in Bangalore.

At the announcement of the deal,Jitendra Virwani,CMD,Embassy Group,had said that the newly formed SPV would be charting out an aggressive road-map to increase its rent-yielding office space portfolio.

REALTY TO RESCUE 

UBHL raised around Rs 100-125 crore from HDFC by way of a rental monetization package comprising its office and retail spaces at UB City UBHLs audited fi nancial report for March 31,2012,states that it has borrowed Rs 525 crore against Kingfisher Towers-Residences at UB City

Shell to hire 600 more R&D staff in Bangalore

Shell will hire an additional 600 researchers and engineers in its Bangalore technology centre and move to a new 40-acre campus in Devanahalli on the outskirts of the city by 2015.

The $470-billion oil and gas company established the tech centre in 2006 and it currently has 900 R&D staff split across two leased facilities.The centre is one of only three such in the world.The others are in Amsterdam in Netherlands and Houston in the US,each with about 1,200 researchers.Given the Bangalore growth plans,the centre here could become Shells biggest in three years.

Matthias Bichsel,director of projects and technology in Royal Dutch Shell,who was in Bangalore for the laying of the foundation stone of the new campus,said the Bangalore centre was Shells lead centre for bitumen research,creating different kinds of asphalt applications for roads.It is a major centre of computational science,which involves gathering massive amounts of data generated to construct mathematical and software models to analyse and solve problems.The centre is modeling,for instance,the surface of our giant oil field in Majnoon in Iraq.It will tell us where to drill the wells,where to locate what, Bichsel said.

The Bangalore centre leads Shells water technology group,which develops solutions to reduce water in the energy discovery and development process.A lot of water currently is used to crack open rocks,to cool refineries and to maintain pressure in reservoirs.

In India,Shell is involved in multiple businesses.It manufactures branded lubricants,has two bitumen plants,is the major investor in the Hazira LNG re-gasification terminal,and operates 60 gas stations.Yasmine Ghandhi Hilton,who took over from Vikram Mehta as Shell India chairman in October,said the company had the license to operate 2,000 gas stations,but the absence of alevel playing field vis--vis the public sector oil companies was holding back expansion.It (the diesel subsidy) is politically challenging for the government,but it will happen over time, she said,and indicated that it may happen once Aadhar makes subsidy-targeting possible.

Bhartiya group announces $2-billion township in Bangalore

 

Bhartiya group has launched $2-billion Bhartiya City, a 125-acre integrated township in Bangalore. The city has IT SEZ component as well.

The group has partnered with Leela Group to operate a 300-room hotel, which is planned as part of the project.

Announcing Bhartiya City, Snehdeep Aggarwal, chairman, Bhartiya group, said, “The project will be developed in phases. In the first phase, we are taking up development of residential, IT office space, retail and hotel.”

“In the first couple of years, we plan to take up 3.2 million square feet of residential, 0.6 million IT office space, 0.7 million retail and 0.5 million hotel,” he added.

The project is located within the BBMP limits. The township is master planned by Perkins Eastman from New York and architects include Broadway Malyan from the UK/Singapore, RSP-Bangalore and Edifice-Mumbai.

“For executing the project, we are leveraging our two decades of expertise in global fashion industry to use design as the differentiator,” said Aggarwal.

As per the master plan, the township comprises of eight districts – residential (Nikoo Homes), mixed use retail, residential and entertainment districts, certified IT-SEZ with an option of ready-to-use office spaces and also an international school, community space and a hospital.

According to Sasi Madathil, CEO, Bhartiya group, the project is a design-driven innovation applied to real estate project. The whole project is likely to be completed in 8 to 10 years.

The group has partnered Leela Group to operate a 300-room hotel. “The group will spend Rs 250 crore for hotel construction and the Leela group will manage the hotel titled Leela Bengaluru,” said Arjun Aggarwal, CEO, Bhartiya City Developers.

“The group has partnered with a few Italian kitchen and furniture makers to provide customised homes at very reasonable prices,” said Swaroop Anish, COO, Bhartiya City Developers.

Spate of property launches in Blore

This Kind Of Trend In Realty Sector Seen Prior To 2008 Downturn 

Its the start of the festive season and property developers are keeping the spirits high with a host of new product launches.Much like what is being seen in the automotive space.

In under 30 days,the city has seen some five new residential launches by A-grade developers,a trend last seen prior to the 2008 downturn.

The new launches range from 2-BHK apartments to 4,000-sqft villas,with prices starting at Rs 37 lakh.

In the first quarter of this financial year,Bangalore was the single largest market in terms of volume.The real estate market in the city has been robust despite the subdued marco-economic sentiments, said Pirojsha Godrej,MD of Godrej Properties.The Mumbai-based developer launched two residential projects in the city in under two-weeks.

On Thursday,Godrej launched a 1-million sqft project,called Godrej E-City,in Electronics City Phase-1,which offers 2,2.5 and 3-BHK apartments,with floor spaces ranging from 964 sqft to 1,625 sqft,at prices starting from Rs 37 lakh.

Prior to this,the company launched a niche villa project,Godrej Gold County,on Tumkur Road,which comprises of 87 units priced above Rs 2 crore.

Mayank Ruia,head-residential of The Phoenix Mills,said,In under a month we have sold close to 350 units of the 400 units on offer in the first phase of our project. The Mumbai-based developer has launched an ultra-high end residential project,One Bangalore West,in Rajajinagar,which has apartments ranging in size from 2,400 sqft to 4,000 sqft at a price of Rs 8,400 per sqft.

In a similar price bracket is Embassy Groups luxury residential project Embassy Lake Terraces at Hebbal.This new project has apartment sizes ranging between 3,500 sqft and 9,900 sqft.Prices start from Rs 3 crore.

Puravankara Projects launched an ultra premium property,Purva Whitehall,on Sarjapur Main Road,which offers buyers only 3 and 4-BHK apartments.

Jackbastian Nazareth,CEO,Puravankara Projects,said The number of enquiries for luxury projects (priced above Rs 2 crore) has increased by close to 30% in the last six months. Nazareth added,The demand for luxury projects is being fuelled by first generation entrepreneurs,senior management from the IT/ITeS sector,and the larger HNI and NRI base in the city. 

In order to showcase to buyers the breadth of offerings now available,Times Property is launching the 8th edition of its property expo,Home Affairs.The expo will be held on October 20 and 21 at The Lalit Ashok.

COMING BACK TO LIFE 

Projects nearing completion in South East and North Bangalore witnessed an increase in capital values of 10-15 % during the first half of 2012 During the January to June period capital values of mid-segment residential units in South East,East and Off-Central locations increased by around 4-8 %,while those in the Central,North and South Bangalore were higher by 1-4 % as compared to the same period a year ago

Bangalore IT.biz 2012 kicks off. Yawn

India's premier IT event was launched today. Did you hear of it? If not, you are in good company. 

The three-day Bangalore IT.biz 2012 - inaugurated with the theme 'Future of ICT: India's big shift to innovation' - began with a function at 10am, 35 minutes late. The small hall, with a capacity of accommodating a few hundred people, was not brimming with people either.

If the few hundred people and stalls put up by various companies are anything to go by, it seems the Bangalore IT.biz, the state government-sponsored event, has been losing its sheen gradually year by year. 

Thousands of people used to vie among themselves to get entry into Palace Grounds, where Bangalore IT.com used to be held. After a few years, the event was shifted to Hotel Ashok. There was no problem for people to visit the event by paying entry fee since the venue was within the city. Though the ongoing event is meant for business-to-business visitors, there were not many people at the event and most of the stalls wore a deserted look.

Chief minister R Jagadish Shettar lackluster speech only added to the gloom. Shettar's speech was full of announcements that were made at events held during his tenure or DV Sadananda Gowda's tenure. During his speech, the chief minister mentioned Karnataka's contribution to IT exports and the job opportunities for engineers in Bangalore. 

As if it is not enough, the chief minister allocated most of his time repeating the number of memorandum of understandings (MoUs) signed during the Global Investor Meet 2010 and 2012. He had also repeated state government's policies for promoting semiconductor and electronic hardware manufacturing. 

He has also mentioned the state government's policy on animation and gaming and how animation and gaming sectors will further strengthen the IT prowess of the state. 

On the much-publicised and hyped Information Technology Investment Region (ITIR) to be established between Devanahalli and Chikkaballapur, the chief minister did not make any announcement on its progress, except indicating that the Union government had given 'in principle' clearance to the project. However, he told media on the sidelines that work on the ITIR will commence before the assembly elections.

Then the chief minister gave out figures. He narrated how the state government had constituted Karnataka ICT Group under the leadership of Mohandas Pai during the Global Investors Meet 2012 to increase the ICT export revenues to Rs 4 lakh crores by 2020 and 20 lakh jobs in ICT segment and help to incubate 1,000 entrepreneur-driven companies by 2020. Chief secretary S V Ranganath was conspicuous with his absence, while Aravind Limbavali, minister for health, was seen leaving the dais much before the chief minister has delivered his speech. That summed up the importance the event had for the Shettar government.

From Worli to Whitefield for real estate

Mumbai-based television professional Jayesh Muzumdar came visiting Bangalore to meet relatives a year ago, and ended up spontaneously buying a 2BHK apartment on the airport road. Today, the apartment in a Purvankara project has appreciated by over 30 per cent – from Rs15 lakh to Rs20 lakh. “That kind of amount would not even make up the down payment component for an apartment in Mumbai. The rates in Bangalore are relatively so low that I did not even have to take a loan,” says Muzumdar.

Another Mumbaikar, Rajesh Rao, purchased a 1000-square-foot apartment in Whitefield for Rs45 lakh earlier this year, and is now earning a monthly rent of Rs15,000 on it. “Compared to Mumbai, Bangalore has much higher demand for rental apartments,” says Rao, adding that for the same rent in Mumbai, he would have had to invest at least twice the amount for an apartment in Mumbai’s suburbs.

For Mumbaikars, who face a starting rate of Rs10,000 per square foot even in the far-flung suburbs of their metropolis, Bangalore’s realty rates offer an easier entry point. Even prominent upcoming areas like Hosur Road, Whitefield, Tumkur Road, Kanakapura Road and Mysore Road have projects priced between Rs2500 and Rs4500 per square foot. “A good percentage of buyers in my Bangalore projects are investors from Mumbai, and even Pune,” says Sunil Mantri, Chairman, Mantri Housing, whose nine projects are in different stages of execution in Bangalore.

“Bangalore's weather and is also a pull factor for individual investors from Mumbai, who are keeping the option open of eventually settling down here,” says Mantri. While Mumbai’s residential realty market has been stagnating for the past one year, Bangalore has witnessed good activity — and upward movement of prices — thanks partly to investors from outside the city.

“While the short-term economic inhibitors currently at play across the country have definitely had their effect on buyers’ sentiments, Bangalore’s residential market is still one of the most resilient from a long haul perspective,” says Karun Varma, managing director for Bangalore & Kochi, Jones Lang LaSalle India, adding that most of the transactions are in the price band of Rs3000 to Rs7500 per square foot.