Embassy Group, Bangalore-based real estate developer, is close to embarking on a massive 80 million square feet of integrated township development worth in the range of Rs 3,000 crore. The company which has accumulated land close to 300 acres over the years, near the Bangalore International Airport (BIA) is understood to be in talks with various players to raise equity for the project.
According to investment bankers close to Embassy Group, the company may be looking at options of raising resources from private equity players as well as some strategic players. According to few investment bankers, the group may open discussions with Emkay Group based in Malaysia. Embassy may be looking to infuse close to Rs 700 crore equity into this project, a part of which is expected to be from an external source. Embassy Group offered not comment on the transaction. The road leading to the Bangalore airport has been attracting a lot of attention from majority of real estate players right from Godrej Properties to Century Real Estate to Brigade Group and now Embassy Group besides a score of other players.
If Embassy decides to go ahead with Emkay Group, it will cement the relationship further between the two players. Embassy already has a joint venture with Azikaf Sdn Bhd, a member of the Emkay Group of Malaysia, for the development of MKN TechZone, a business park being developed in Cyberjaya, Malaysia.
The Emkay Group is active in residential, commercial, resort and ICT developments. In addition to this, Embassy also has a joint venture agreement with MK Land, Malaysia. Through this partnership with MK Land, Embassy intends to develop affordable housing projects in India. MK Land is a major property developer in Malaysia. The company has a diversified portfolio of projects, which includes affordable housing, lifestyle living, commercial development, resort, a water theme park and property investment.
If this move by Embassy fructifies, it will be its second major equity fund raise in the recent past after it raised a record $200 million from global private equity major Blackstone for a SEZ project in Bangalore. During late 2010, Embassy was planning to take the company public in a Rs 2,400 crore issue, but had to give up the plans as the markets tanked.
Embassy Group, which started operations in 1993, has an extensive land bank across the country and has developed over 28.5 million square feet of prime commercial, residential and retail space.
The majority of the completed projects in its commercial portfolio are built-to-suit and fit-out developments undertaken for specific clients. Going forward, the company intends to undertake a combination of built-to-suit projects and those done without pre-commitment.
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