Sahara, ICICI in fray to buy Parsvnath's Connaught Place land
New Delhi: Sahara Group, ICICI Bank, Bhushan Steel, Bharti Realty, Red Fort Capital and Shri Lal Mahal are understood to be in the race among others to acquire Parsvnath Developers' 1.18 acre of prime commercial land near Connaught Place in the National Capital.
In January, Parsvnath had announced plans to monetise the KG Marg land, which it had bought for Rs 200 crore in 2008.
Parsvnath, which is eyeing about Rs 700 crore from sale of this land, got the building plan approved from local authority last week and potential buyer can start construction on the land immediately after the deal, sources said.
"The first round of bidding and due diligence have been already completed. The process will be expedited now as the company was waiting for the building plans approvals before it starts negotiation with potential buyer," a source, who is involved in the process, said.
Sahara Group, ICICI Bank, Bhushan Steel, Bharti Realty, private equity firm Red Fort Capital, rice company Shri Lal Mahal and one leading realty firm from NCR have shown interest in buying this land, sources said, adding that Parsvnath had got bids up to about Rs 700 crore in the first round of bidding.
When contacted, Parsvnath Developers Chairman Pradeep Jain said: "The process for sale of this land is on. We can not comment any further." Property consultant Jones Lang LaSalle India is helping Parsvnath in this deal.
The built-up area allowed on this prime land is about 1.5 lakh sq ft with 300 car parking. Realty consultant said that prime office buildings near CP are currently commanding a monthly rental of 350-400 per sq ft.
Although Jain did not give any timeline for completion of this transaction, sources said that the deal could be closed in this quarter.
Parsvnath has a net debt of about Rs 1,200 crore and plans to reduce it to about Rs 500 crore by utilising the proceeds from sale of this prime property.
The company has two housing projects and several shopping malls at metro stations in the National Capital. It is setting up an office building near Gole Market here with an investment of Rs 300 crore.
That apart, Parsvnath had bought in 2010 a 38 acre of land near Sarai Rohilla from the Railways for Rs 1,651 crore, making it the second biggest land deal in Delhi.
The company, in partnership with Red Fort Capital, plans to provide luxury housing and commercial space in this project.
Parsvnath, which has a land bank of about 200 million sq ft across the country, had received private equity funding from Sun Apollo and JP Morgan in some other projects in NCR.