Tata Housing on a Land acquisition spree
In the current financial year Tata Housing, the Tata Group’s real estate company, has decided to invest Rs 3,000 crore to acquire more land, including joint development agreements, across major cities in India. Brotin Banerjee, the MD & CEO of Tata Housing Development mentioned that Tata Housing’s expenditure will be 50-60% more in land acquisition and joint development agreements in this year compared to FY14. Internal accruals will be the key to finance these projects.
The four metros Bangalore, Kolkata, Delhi NCR, and Mumbai will be the prime locations for the land purchases and the new projects. These projects include residential establishments in both in the premium and the affordable category. While proposed premium homes will cost between Rs 6,500 and Rs 12,000 per square feet, spread over 900-3500 square feet each, depending on the location, affordable homes will be under Rs 40 lakh, between 450 and 1250 square feet.
Banerjee also mentioned that the land rates in an area will be the deciding factor to launch a premium or affordable project in that area. About 65 % of the planned launches will be in the premium segment, while the rest will be in the affordable category. They are hoping to capture the market share in the real estate industry and add 90 million square feet of additional property in the next one year through new launches. The current land inventory of this Mumbai based realty firm is about 70 million square feet. Of this 70 million, around 17-20 million square feet was added last year. There are various projects going on across 8 states on this existing land repository. Since the economy was going through a slump, the firm had decided to purchase land and increase the inventory for the future projects as the revival of the market was speculated.
Source- The Economic Times
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