The Adani Group is exploring the possibility of monetising parts of its real estate holdings that have been internally flagged as non-core to its operations, said two people directly aware of the development. The group has already identified some such assets and is in the process of adding more to the list, the people said. These will be sold based on the need for funds to invest in the new real estate projects it is taking up, they said.
To begin with, the group has restarted conversations to explore a potential sale of Inspire BKC, a commercial real estate project situated on the edge of the Bandra-Kurla Complex (BKC), Mumbai’s bustling business district that is home to a host of multinationals and Indian corporate houses.
“Discussions are currently underway with potential buyers which include Brookfield Asset Management and the Adani Group expects a non-binding term sheet soon with a tentative valuation of ₹650 crore,” said one of the people.
Inspire BKC has a total leasable area of 800,000 sq ft, and is fully leased to tenants like Novartis, Reliance Nippon Life Insurance and MUFG Bank.
The 10-storey standalone tower was built in 2016 as part of a slum rehabilitation project. The talks of the asset being on the block has been going on since 2017 with several global institutional investors reported to be looking to acquire it.
A Brookfield spokesperson declined to comment on a query sent by ET. An email sent to Adani Group on Sunday seeking comment remained unanswered at press time.
“Alongside, the group has also identified the real estate holding of group firms ACC Ltd and Ambuja Cements which it acquired last year from Holcim,” said the second person.
The group is looking to monetise around 16 acres owned by ACC in Thane near Mumbai, this person said, adding that the group was expecting up to ₹500 crore from the transaction. A large chunk of Adani Group’s real estate assets is owned by privately held Adani Properties.
The move is part of the group realignment strategy and the funds raised will be used towards meeting investment needs of the group’s real estate projects.
A relatively late entrant into the real estate sector, the group is currently developing commercial and real estate projects in prime real estate markets including western India. The group has also won the bid to redevelop Dharavi, one of the largest slum clusters in the world, with an initial investment of about ₹5,069 crore.
The group will have to eventually invest ₹20,000 crore in the project and, 20% of this initial investment will have to be submitted to the Maharashtra government before signing the development agreement and an additional 20% on submitting an integrated master plan.
TORONTO – One expert predicts Ottawa‘s changes to mortgage rules will help spur demand among potential homebuyers but says policies aimed at driving new supply are needed to address the “core issues” facing the market.
The federal government’s changes, set to come into force mid-December, include a higher price cap for insured mortgages to allow more people to qualify for a mortgage with less than a 20 per cent down payment.
The government will also expand its 30-year mortgage amortization to include first-time homebuyers buying any type of home, as well as anybody buying a newly built home.
CIBC Capital Markets deputy chief economist Benjamin Tal calls it a “significant” move likely to accelerate the recovery of the housing market, a process already underway as interest rates have begun to fall.
However, he says in a note that policymakers should aim to “prevent that from becoming too much of a good thing” through policies geared toward the supply side.
Tal says the main issue is the lack of supply available to respond to Canada’s rapidly increasing population, particularly in major cities.
This report by The Canadian Press was first published Sept. 17,2024.
OTTAWA – The Canadian Real Estate Association says the number of homes sold in August fell compared with a year ago as the market remained largely stuck in a holding pattern despite borrowing costs beginning to come down.
The association says the number of homes sold in August fell 2.1 per cent compared with the same month last year.
On a seasonally adjusted month-over-month basis, national home sales edged up 1.3 per cent from July.
CREA senior economist Shaun Cathcart says that with forecasts of lower interest rates throughout the rest of this year and into 2025, “it makes sense that prospective buyers might continue to hold off for improved affordability, especially since prices are still well behaved in most of the country.”
The national average sale price for August amounted to $649,100, a 0.1 per cent increase compared with a year earlier.
The number of newly listed properties was up 1.1 per cent month-over-month.
This report by The Canadian Press was first published Sept. 16, 2024.
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
