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Thursday, April 25, 2013

Mahindra Lifespace plans to close 4-5 land acquisitions

This story first appeared in DNA Money edition on Tuesday, April 23, 2013.

Mahindra Lifespace Developers Ltd is likely to close 4-5 new land deals as it looks to step up on new projects.

The company has signed eight memorandum of understanding (MoUs) for land procurement so far.

Anita Arjundas, managing director and chief executive, Mahindra Lifespace, said, “We have already closed two (of the eight MoUs) in the last quarter and a new one early this month. The balance are in different stages of due diligence and will close them as we go along.” She did not share financial details related to the deals closed.

The company earlier had said it planned to sign in all 10 MoUs. The realtor, which recently raised Rs 500 crore through non-convertible debentures, will utilise the money to close MoUs that are under due diligence stage.

Of the three deals concluded, two are in Mumbai and one in Bangalore.

The Mumbai parcels include three acre Nicomet site on the Andheri-Kurla road with a development potential of 3.6 lakh sq ft and a 14.5 acre site at Boisar for affordable housing with a development potential of 5.5 lakh sq ft.

The 4.5 acre Bangalore parcel is on Bannerghatta Road for 6 lakh sq ft  of development.

“For Boisar, we have completed designing and submitting for approvals next month. An architect has been appointed for the Andheri site and we should be signing the first round of design development soon. We haven’t really started on the Bangalore site yet,” said Arjundas.

The company has had a joint development agreement (profit-share) on a five acre mill land near Byculla Zoo in Mumbai. The partners are currently exploring the option of selling the land parcel together and sharing the consideration. Mahindra Lifespace has issued a mandate to Cushman & Wakefield for the sale of the property. The realtor had invested Rs70 crore in this land parcel.

Announcing its financial results, the company posted a 95% increase in its consolidated net profit at Rs82 crore for the quarter ended March 31, mainly on the back of improved sales. Total income during the reporting quarter rose 32% to Rs368 crore.

The company expects to complete five million sq ft development in fiscal 2014 even as it added new land inventory with an estimated development potential of two million sq ft in fiscal 2013.

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