Property :
Realty funds are facing new interest

                  According to market sources, an estimated US$2 billion is likely to flow into Bangalore real estate market in the next one year. Most of them are looking for long-term projects with a span of 3-4 years.
                  Companies like Kotak Mahindra, IDBI and HDFC have already mobilized realty funds worth US$ 3.5 billion for investment in the coming months in selected cities. A number of trade delegations are regularly visiting Bangalore and interacting with property consultants and established developers to explore potential opportunities available for investment in real estate development. (Source: The Economic Times)
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       The market stimulation is predominantly attributed to the investors offloading their stock at lower than the rates quoted for new projects. It is this trend that has given a virtual boost to the market which has been reporting slackening sales over the past six months.
       The priority is for land which has already been converted and available for development. Fund managers are not keen to commit investment in lands which are not converted or not coming in the urbanized zone.
According to market sources, realty funds anticipate an IRR of 22 percent and above.
       A significant development is that most of the funds are bullish on Bangalore’s potential and keen to commit investment at project level through a special purpose vehicle (SPV) formed specifically for this purpose.
              Prices are stabilizing and end users are active in the market. The demand for high-end homes continues as the supply is limited and availability is at prime locations in the city. Home buyers are finding the resale properties in the market a better option to plunge into investment.
              The residential property market is stable but there has been a perceptible trend among home buyers to opt for projects which are under construction stage.
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                  Among the criteria for forging strategic partnership with locally established developers include developers who are uncompromising in the market and those who want to expand in different areas. Outright deals in land are dipping in view of the tight liquidity scenario. With the result land owners too are compelled to forge strategic alliance with established developers through joint venture development.
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