oct 2019 - credai · 2019-10-03 · proptiger, the co-living space has emerged as a "real...

03-Oct-2019

CREDAI Bengal Daily News Update | 03.10.19

Loan fairs for providing credit to be held across 250 districts starting today

The loan fairs announced by the government are aimed at providing credit to retail

customers and MSMEs in the wake of a demand slowdown.

The first phase of 'Loan Mela' will begin from Thursday across 250 districts across the country.

(Photo: PTI/Representational image)

HIGHLIGHTS

First phase of 'Loan Mela' starts Thursday across 250 districts

During the four days beginning October 3, on spot loans will be sanctioned

Earlier this year, public sector banks decided to undertake outreach exercise in identified 400

districts

The first phase of 'Loan Mela', an outreach programme for providing credit to retail customers

and MSMEs, will begin from Thursday across 250 districts across the country to meet demand

during the festival period.

During the four days beginning October 3, loans will be sanctioned for retail, agriculture,

vehicle, home, MSME, education and personal categories on the spot.

Newspaper/Online India Today (online)

Date October 03, 2019

Link https://www.indiatoday.in/business/story/loan-fairs-for-providing-credit-to-be-held-across-250-districts-starting-today-1605757-2019-10-03

All banks, including State Bank of India (SBI), Punjab National Bank (PNB), Bank of Baroda

(BoB), and Corporation Bank have geared themselves up to take advantage of festival season

demand.

SBI is the lead banker in 48 districts across the country. Likewise, BoB is the lead banker in 17

out of 250 districts in the first phase.

Simultaneously, it is holding Baroda Kisan Pakhwada during which most of its branches would

focus on promoting farm loans, BoB said in a statement.

During the annual performance review earlier this month, public sector banks decided to

undertake outreach exercise in identified 400 districts. Later, the private sector too expressed

their willingness to join the initiative.

This is part of the systematic bank reform process which envisioned taking banks to doorsteps

of customers.

These camps will provide a one-stop destination for MSMEs, small retail businesses and end

customers to access all bank services, especially loans in auto, home, personal and business

section.

While at one level it will help businesses to gear up for the festive season, it will also provide

ready cash in the hands of consumers.

Needless to say, all prudent financial norms and due diligence will be followed by PSBs while

disbursing loans, a top official of the public sector bank said.

Awareness camps will be held in these districts to let people know about the event.

For spreading information, the banker said, local vendor associations, commercial organizations

and chambers of commerce may also be engaged to spread the message among merchants and

customers.

In line with the government's thrust on Digital India, the initiative will focus on financial

inclusion schemes and digital payment methods so as to encourage consumers and merchants to

increasingly shift to these payment modes, the sources noted.

Apart from PSBs, NBFCs/HFCs/MFIs/SIDBI and private sector banks can also participate in

the scheme.

The second phase will be in 150 districts and will be held between October 21 and October 25,

just before Diwali.

____________________________________________________________________________________

Student housing, retirement homes, co-living new realty growth

drivers: Parekh

Student housing is a very big growth area and it has taken off well, says Deepak

Parekh

'The other growth area right now is co-living. People, including foreign investors,

have also started talking about rental housing,' he further says

Confident about real estate sector doing well as long as there are "right developers, right pricing

and right unit size", eminent banker Deepak Parekh has said a number of new growth drivers

are also emerging in form of student housing, retirement homes and co-living projects.

He also said foreign investors have also been investing in a big way in good commercial

projects, while warehousing is another segment where they are showing keen interest.

"Student housing is a very big growth area and it has taken off well. Many universities, colleges

and educational institutions are now in fact selling their own housing to raise money to build

more classes, facilities etc," Parekh told PTI in an interview.

"The other growth area right now is co-living. People, including foreign investors, have also

started talking about rental housing. And many are also building projects for senior citizens,

including some being built by people themselves. We are funding some of them actually," the

chairman of the country's biggest housing finance company HDFC Ltd said.

Retirement homes are like hostels with all kinds of facilities available for senior citizens,

including medical facilities, and places like Delhi-NCR, Bangalore and Mumbai-Pune region

have started seeing such projects.

According to a recent study conducted by News Corp and Softbank-backed realty portal

PropTiger, the co-living space has emerged as a "real estate goldmine" that remains largely

untapped and has potential to become USD 93 billion market annually on rising demand from

students and professionals.

"This is evident from the fact that the supply by organised players in co-living is currently

limited to over one lakh beds. Assuming they earn ₹1.44 lakh (USD 2,021) per annum per bed,

organised players in this segment are currently USD 206 million," the study said.

The report further said that the co-living sector has total untapped demand of about 46.3 million

beds, out of which 8.9 million is from student housing.

Newspaper/Online Live Mint (online)


Link https://www.livemint.com/industry/infrastructure/student-housing-retirement-homes-co-living-new-realty-growth-drivers-parekh-11570029622399.html

Among the existing players in the segment are RentMyStay, Rentroomi, SimplyGuest and

Flathood. Other players such as NestAway, Stanza Living, Zolo, Placio and CoLive have

recently entered this sector and raised funds to spread the business.

On the other hand, the co-working space is also seeing huge growth.

According to property consultant Knight Frank, co-working operators have leased 4 million sq

ft of office space across eight major cities during the first half of 2019 to meet rising demand of

such flexible area from corporates and startups. This marks a growth of 42 per cent over H1-

2018.

Asked whether foreign investors, mostly private equity players, are also keen on investing in

residential projects, Parekh said, "They are going big on commercial projects, malls etc. A large

number of them are getting into joint ventures."

"They are also getting into warehousing, including for food, data, commodities etc.

Warehousing is a big business now," he said.

He said some foreign players are also keen on residential projects and they would be keen to

buy parts of a project if they get good discounts and this can be of significant benefit for

developers who have unsold projects.

Earlier in his annual letter to shareholders, Parekh had said the housing market in India has been

so far been looked at from the lens of the country's young demographic profile.

With 65 per cent of the population being under the age of 35 years, this trend is likely to

continue.

At the same time, there is another demographic aspect that India now needs to focus on as the

population of senior citizens in India is expected to grow to 173 million by 2025 -- a growth of

more than double in a decade's time, Parekh said.

"By 2050, India is estimated to have 240 million senior citizens. The Ministry of Housing and

Urban Affairs has demonstrated foresight by issuing model guidelines for development and

regulation of retirement homes for senior citizens," he said.

The model guidelines call for a tripartite agreement between the developer, resident of the

retirement home and the service provider. The service provider's role is to offer customised

services to senior citizens such as medical, security, infrastructure, house-keeping, amongst

others.

"One hopes the housing ministry will take up the responsibility to ensure that every state in

India adopts these guidelines. This in turn would help widen the bouquet of housing finance

products," Parekh said.

____________________________________________________________________

Chandigarh plans to link conversion of properties with collector

rates in industrial area

The administration has directed officials of the UT estate office to study policies of

Punjab, Haryana and Delhi in connection with converting leasehold properties into

freehold in Industrial Area.

The UT administration has planned to link conversion of leasehold properties into freehold in

Industrial Area, phases I and II, with prevailing collector rates.

The administration has directed officials of the UT estate office to study policies of Punjab,

Haryana and Delhi in connection with converting leasehold properties into freehold in Industrial

Area.

At present, the collector rates in Industrial Area is Rs 65,000 per square yard.

A senior UT official said they have directed estate department officials to prepare a report on

the basis of existing collector rates. Similarly, they would also study policies of the

neighbouring states. Accordingly, they will formulate a policy for the UT and take up the matter

with the ministry of home affairs (MHA). After getting the ministry’s approval, the UT would

notify the conversion rates, he said.

The matter was recently discussed in a meeting chaired by UT adviser Manoj Parida with

members of Industrial Advisory Committee. Members of the committee had shared suggestions

like introducing single window system for immediate disposal of industrial cases and

appointment of nodal officer for speedy redressal of the issues.

The administration had last converted leasehold plots into freehold in 1983 in commercial

category. The matter was also taken by up MP Kirron Kher with the MHA and the ministry of

urban development.

Recently, the administration had conducted a survey in Industrial Area for checking leasehold

plots.

The administration had set up Phases I and II of Industrial Area during the 1970s on an area

measuring 147 acres. The plots are governed by zoning and architectural control, which were

prepared as per the conditions prevailing at that time. There are 1,884 plots in both phases, of

which 700 are 1 kanal and above, while there are 443 and 180 plots measuring 10 and 15 marla,

respectively. There are as many as 381 plots of 5 marla.

Newspaper/Online ET Realty (online)


Link https://realty.economictimes.indiatimes.com/news/industry/chandigarh-plans-to-link-conversion-of-properties-with-collector-rates-in-industrial-area/71402424

‘USER-friendly rates’

The conversion of leasehold to freehold is an important matter. The UT administration should

finalize conversion rates, which should be user-friendly for industrialists

Pankaj Khanna | President | Industries Association of Chandigarh

The UT administration should follow Punjab formula while finalizing conversion rates. The

administration follows neighbouring state Punjab in issues like VAT and excise, so they should

follow Punjab in this case as well

Chander Verma, President, Chandigarh Converted Plot Owners Association.

Need-based changes

Recently, the administration had allowed business to business (B-2-B) activities in Industrial

Area and certain need-based changes. To meet their requirements, the owners have made

changes in the building plans in violation of bylaws for which they were facing misuse notices.

In their defence, industrialists had accused the administration of not amending the bylaws in

time, which forced them to make changes in their properties in violation of norms.

High charges for residential plots’ conversion

Residential properties in city were freely allowed to convert to freehold till April 2012, when

the practice was discontinued. The decision to again allow conversion of leasehold residential

properties to freehold was announced in August 2017.

All the hype, however, fizzled out soon after local MP Kirron Kher made the announcement of

the rates on August 18, 2017, amidst much fanfare. The administration had fixed the conversion

rates of flats allotted by CHB and estate office on a pro-rata basis (proportionate allocation

according to share).

For plotted houses, residents will have to pay conversion charges calculated as per the formula

prescribed in the Chandigarh Conversion of Residential Leasehold Land Tenure into Freehold

Land Tenure Rules, 1996. Earlier, the administration was charging only Rs 1,710 per square

yard for plotted houses.

________________________________________________________________

Andhra Pradesh CM directs officials to resolve sand crisis

Jagan, who held a video conference with district collectors and SPs to review the progress

of grievance programme Spandana, told the collectors to assign sand supply responsibility

to a joint collector level officer in the district.

Chief minister YS Jaganmohan Reddy directed officials on Tuesday to resolve the

continuing sand crisis in the state without further delay. He told them to hire transport agencies

to supply sand and ensure there is no crisis.

Jagan, who held a video conference with district collectors and SPs to review the progress of

grievance programme Spandana, told the collectors to assign sand supply responsibility to a

joint collector level officer in the district.

As floods in the rivers are receding, the CM wanted the collectors to start sand mining and fill

the stock points. He told them to address the present crisis in the next 60 days and streamline

sand supply.

When some collectors pointed out that transportation has become a major problem, Jagan told

them to offer loans to SC, ST, BC and minority youths in the state to buy vehicles and take up

sand transportation.

“Don’t encourage political recommendations in sand supply and transportation. Sand mafia

should be eradicated. I will give a free hand to officials in this regard,” the CM said, adding that

people should see the difference between his government and the previous one in handling of

sand issues.

On resolving of grievances, the chief minister told collectors to hold orientation classes for

government officials in every district of the state from October 16. He wanted the collectors to

monitor the training programme and make employees responsible for resolving peoples’ issues.

“Every grievance should be resolved within 72 hours,” he said.

The CM also asked collectors to build a network to coordinate with village secretariats once

they start functioning. He said he would wait for the village secretariats to be streamlined by

end of December, as the newly-recruited employees also require some training.

________________________________________________________________



Link https://realty.economictimes.indiatimes.com/news/allied-industries/andhra-pradesh-cm-directs-officials-to-resolve-sand-crisis/71402552

DLF settles Rs 8,700 crore amount payable to JV with GIC

With settlement of this dues, the company said it has completed the exercise of

transforming its balance sheet and consolidation of all rental assets under the DCCDL.

Realty major DLF has settled the entire Rs 8,700 crore amount payable to DLF Cyber City

Developers Ltd (DCCDL), its joint venture with Singapore-based GIC, by transferring various

completed commercial properties and land parcels as well as cash payment.

With settlement of this dues, the company said it has completed the exercise of transforming its

balance sheet and consolidation of all rental assets under the DCCDL.

DLF holds 67 per cent stake in DCCDL, while Singapore's sovereign wealth fund GIC holds 33

per cent.

At the end of 2018, DLF owed Rs 8,700 crore to DCCDL and the amount payable came down

to Rs 5,600 crore by July 1, 2019.

In a filing to the BSE on Wednesday, DLF said the "inter-company payables have now been

fully settled".

As part of the settlement, DLF has transferred its shareholding in its arm DLF Info Park

Developers (Chennai) at an enterprise value of Rs 1,000 crore. This subsidiary holds nearly 27

acres of land.

That apart, it has transferred its shopping mall in Saket, South Delhi for an enterprise value of

Rs 1,012 crore.

DLF also transferred its shareholding and compulsorily convertible debentures (48.2 per cent of

the fully diluted capital) in Fairleaf Real Estate Pvt Ltd, a joint venture company that owns One

Horizon Center commercial project in Gurugram, for an enterprise value of Rs 1,700 crore.

According to sources, DLF has settled around Rs 2,000 crore through cash.

"This has been a major restructuring exercise and has now resulted in a larger alignment of the

Group's rental assets under the DCCDL platform," DLF said.

After these transfers and consolidation of commercial assets, DLF said DCCDL is positioned

even more strongly to continue its growth journey.

"The total settlement of receivables (net of values received for transfer of shareholding /

dividend received from DCCDL and other inter-company adjustments) will result in an increase



Link https://realty.economictimes.indiatimes.com/news/industry/dlf-settles-rs-8700-crore-amount-payable-to-jv-with-gic/71415791

in the company's net debt by only Rs 475 crores approx," the filing said.

DLF said it has completed the final chapter of its balance sheet transformation.

Earlier, DLF had transferred Mall of India project at Noida, Uttar Pradesh to DCCDL at an

enterprise value of Rs 2,950 crore. The realty firm had also transferred 3.05 acres land parcel at

Gurugram, Haryana.

DCCDL currently holds nearly 30 million sq ft of rent-yielding commercial assets, largely in

Gurugram, with annual rental income of about Rs 3,000 crore.

In December 2017, DLF entered into this joint venture with GIC when DLF promoters sold

their entire 40 per cent stake in DCCDL for nearly Rs 12,000 crore.

This deal included sale of 33.34 per cent stake in the DCCDL to GIC for about Rs 9,000 crore

and buyback of remaining shares worth about Rs 3,000 crore by DCCDL.

______________________________________________________________

UP-RERA to retender over 24 stuck projects in NCR

The move will benefit more than 30,000 home buyers, a top official said. Unsold flats and

nearby land will be used by the new promoter to generate money and complete the

project, UP Rera chief Rajive Kumar said.

People who have bought flats in projects where the construction is stopped for more than a year

in Noida, Greater Noida and Ghaziabad may soon get to see their projects being revived by a

new developer.

Real Estate Regulatory Authority (Rera) of Uttar Pradesh has identified more than two dozen

'stuck projects' in the NCR towns of the state to deregister them and invite fresh tenders from

developers to complete the construction.

The move will benefit more than 30,000 homebuyers, a top official said.

Unsold flats and nearby land will be used by the new promoter to generate money and complete

the project, UP Rera chief Rajive Kumar said.

He said there is provision for this under Sections 7 and 8 of the Real Estate (Regulation and

Development) Act, 2016. “Section 7 says if a project is stuck, then all the violation is brought to

the notice of promoter,” he told ET.

“In case he is willing to take action to complete the project, we give him the opportunity and put

a monitoring committee.”

In cases where original promoter is not in a position to complete the project, the Residents’

Welfare Association (RWA) is asked to come forward and if two third of them agrees, the

authority starts the procedure to deregister the project under Section 8.

This provision was first exercised in May when Rera deregistered three phases of Unnati

Fortune Holdings’ Aranya housing project in Noida.

Rera had found financial irregularities, diversion and siphoning of funds, and duplicate

allotment of apartments in Aranya project, Kumar alleged. “This case will become a benchmark

for such projects,” he said. “We had issued notice to 6-7 developer and the first case is with the

appellate authority.”

On Monday, the authority deregistered PSA Impex’s Sampada Livia residential project in

Greater Noida. According to Rera, there were around 750 units which were proposed in this

project and no work has been done since 2018 on the site.



Link https://realty.economictimes.indiatimes.com/news/residential/up-rera-to-retender-over-24-stuck-projects-in-ncr/71415814

In March, the authority had issued deregistration notices to seven builders for failing to meet

their commitments to buyers covering 14 projects and 4,800 residential units.

Developers who had been served notices included Primrose Infratech for Primrose Ryne

project, PSA Impex for Sampada Livia, MSA Developer for Circuit Heights, Greenbay

Infrastructure for Greenbay Golf Homes and Golf Village, Intellicity Business Park for

Intellicity project, Mist Direct Sales for Festival City Phases 1, 2 and 3, and Unnati Fortune

Holdings Ltd for the Aranya Phases 3, 4 and 5.

________________________________________________________________

DHFL lenders may have to take up to 30% haircut

The loan amounts to about Rs 84,000 crore. A haircut on loan is a partial loss incurred by

a creditor on the advances or deposits.

Lenders to bankrupt mortgage firm Dewan Housing Finance Limited (DHFL) may have to take

up to 30 per cent haircut on their loans even as the company had in its resolution plan promised

a full payout of its debt over 10-20 years.

“We don’t have complete liability tenor and coupon profile,but aggregate haircut will be

between 28-37 per cent for discounting rate between 9-12 per cent,” said Jefferies, a brokerage,

in a report.

The loan amounts to about Rs 84,000 crore. A haircut on loan is a partial loss incurred by a

creditor on the advances or deposits. However, the exposure of most banks to the embattled

company may not impact the earnings due to early provisions taken by lenders on their books.

“Banks and mutual funds have taken 30-50 per cent MTM hit on bonds, so incremental

provisioning needs should be small, but NPL provisions will come later,” Jefferies said. As per

DHFL’s repayment plan, cash proceeds from loan assets would be used to repay creditors. The

first category of debt worth over Rs 34,800 crore will be repaid through inflows from the

company’s retail loans, where the projected cash inflow stands at over Rs 52,600 crore by

financial year 2034-35. However, a higher rate of discount on these cash flows could

substantially impact the NBFC’s ability to honour its 100 per cent repayment commitment, says

the analyst.

“Discounting the assigned cash flows at 10 per cent (or a range of 9-12 per cent) suggests

implied haircut at 31 per cent on average, (or in a range between 28-37 per cent) for the

lenders,” the report said. “A delay in cash inflows or a lower-than-expected recovery could

further increase the haircut for lenders.”

Further, the brokerage said that while retail and project loans, which make up for about 63 per

cent of the overall debt, could see lower haircuts in the range of 10 per cent or less, its slum

rehabilitation projects and inter-corporate deposits may see haircuts of 60 per cent and above.

Public deposits depending on the cashflows and discounts may also have to incur haircuts of the

tune of 5 per cent.

The NBFC had earlier appointed Vaijinath MG, a former chief general manager of State Bank

of India, as its CEO and floated a draft debt resolution plan according to which it has assumed a

price of Rs 54 per share for conversion of debt into equity by lenders that would give them 51

per cent, the company said in its resolution plan submitted to the exchanges on September 28.



Link https://realty.economictimes.indiatimes.com/news/allied-industries/dhfl-lenders-may-have-to-take-up-to-30-haircut/71416090

The plan is subject to approval by lenders and investors.

_______________________________________________________________________________________________________________

oct 2019 - credai · 2019-10-03 · proptiger, the co-living space has emerged as a "real...

Documents