Struggling builders plan to sell off their non-core land holdings
ET Realty, May 15, 2009, Page 1
In a bid to raise money for their ongoing projects and survive the downturn, many builders are planning to sell off their non-core land holdings. In a booming property market, several builders had built land banks. Often, land was purchased even in markets where they had a comparatively low presence. With the market situation having changed, and other routes of raising funds — bank loans, private equity and going public — proving to be difficult, builders have resorted to selling their land, even at a discount. Anuj Puri, managing country head of real estate consultancy Jones Lang LaSalle Meghraj (JLLM), said: “Yes, the present market situation has forced many developers to sell their non-core land where they had invested earlier. Builders are just focusing on their core projects for the moment and looking to complete them.” Ostensibly, the builders are not getting the price they had paid earlier. In some cases, say industry sources, builders are willing to settle for a drop in 30% over what they paid.
ET Realty, May 15, 2009, Page 1
In a bid to raise money for their ongoing projects and survive the downturn, many builders are planning to sell off their non-core land holdings. In a booming property market, several builders had built land banks. Often, land was purchased even in markets where they had a comparatively low presence. With the market situation having changed, and other routes of raising funds — bank loans, private equity and going public — proving to be difficult, builders have resorted to selling their land, even at a discount. Anuj Puri, managing country head of real estate consultancy Jones Lang LaSalle Meghraj (JLLM), said: “Yes, the present market situation has forced many developers to sell their non-core land where they had invested earlier. Builders are just focusing on their core projects for the moment and looking to complete them.” Ostensibly, the builders are not getting the price they had paid earlier. In some cases, say industry sources, builders are willing to settle for a drop in 30% over what they paid.
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