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Jaypee lenders slammed for ‘back door’ talks with Adani

Jaypee lenders slammed for ‘back door’ talks with Adani

July 3, 2019 in Jaiprakash Associates

NEW DELHI: The National Company Law Appellate Tribunal has called out lenders of Jaypee Infratech for engaging in “backdoor negotiations” with the Adani group on the resolution of the debt-laden real estate company after the committee of creditors rejected a revised resolution plan proposed by government-owned NBCC. Adani group had submitted a non-binding proposal to lenders of Jaypee Infrastructure, offering to infuse Rs 1,700 crore in fresh equity and begin delivery of flats to homebuyers within nine months, according to a counsel for the lenders. The group has also offered to pay .`1,000 crore to settle dues of workmen and financial creditors. A three-member NCLAT bench led by Justice SJ Mukhopadhaya was not convinced. “NBCC is a government company. One can rely on it,” the bench said. “How do you know that they (Adani Group) will complete the projects within nine months? If Jaypee Infratech cannot complete, they will not complete. They don’t have experience in infrastructure.” The bench directed representatives of lenders, homebuyers, directed representative of lenders, homebuyers, NBCC and other stakeholders to appear before it to modify the plan to make it acceptable to all stakeholders after it was informed that the bid by NBCC had not been approved by the committee of creditors (CoC). NBCC had proposed to infuse Rs 200 crore as equity to finish incomplete projects by 2023 and transfer 950 acres of land worth Rs 5,000 crore to lenders. Ramji Srinivas, counsel for IDBI, said lenders have opposed the NBCC bid in part because it required that lenders provide an additional Rs 1,400 crore to NBCC for the completion of the projects. A counsel for the resolution professionals said homeowners constituting 34.75% of the CoC had approved NBCC’s resolution plan under the Insolvency and Bankruptcy Code (IBC), while all lenders representing 40.70% of CoC rejected the plan. Homebuyers representing about 23.8% of CoC abstained from voting while 1.44% voted against the NBCC bid. A resolution plan requires the approval of at least 66% of CoC to be accepted. Jaypee Infratech has total outstanding debt of around Rs 9,800 crore and has failed to deliver flats to over 23,000 homebuyers. Homebuyers form around 60% of the committee of creditors while 13 lenders constitute the remaining 40%. The NCLAT bench stressed that its priority was to provide a resolution to homebuyers and that it would decide in this case that the maximisation of assets on the cases involving allottees may be defined by the maximization of the flats that can be provided to allottees. “We are not bothered about the banks, we are bothered about allottees,” the bench said, adding that if no resolution plan was accepted, the bench may allow the promoters to enter into an agreement with homebuyers as a separate class of creditors to complete the housing projects. Sources: realty.economictimes.indiatimes.com

NCLAT directs NCLT to decide on IBC plea against JP Associates in six weeks

NCLAT directs NCLT to decide on IBC plea against JP Associates in six weeks

July 2, 2019 in Jaiprakash Associates

NEW DELHI: The NCLAT Monday directed the National Company Law Tribunal to decide the insolvency plea filed by ICICI Bank against Jaiprakash Associates in six weeks. The private sector lender had approached the National Company Law Appellate Tribunal (NCLAT), seeking a direction to NCLT Allahabad-bench to expedite the hearing on its insolvency petition against Jaypee Group firm Jaiprakash Associates Ltd (JAL). Hearing the matter, a three-judge bench of the NCLAT headed by Chairman Justice S J Mukhopadhyaya directed the NCLT Allahabad to decide on admitting the plea preferably in six weeks. In September 2018, ICICI Bank had filed a petition before the NCLT Allahabad bench seeking to start insolvency proceedings against JAL, which is into infrastructure and real estate space. In its plea before the appellate tribunal, the bank had submitted that there has been no progress in its petition filed before the NCLT Allahabad in last nine months. JAL's subsidiary Jaypee Infratech is already going through corporate insolvency resolution process (CIRP). According to the bank, JAL owes around Rs 1,296 crore and it had approached the NCLT to recover the dues by filing an insolvency plea against JAL, under section 7 of Insolvency & Bankruptcy Code (IBC). However, JAL challenged the petition before the Allahabad High Court but the same was rejected. JAL then moved the Supreme Court, which too refused to stay the application. Sources: realty.economictimes.indiatimes.com

Anil Ambani to lease or sell seven lakh sq ft Santacruz HQ for about Rs 3,000 crore

Anil Ambani to lease or sell seven lakh sq ft Santacruz HQ for about Rs 3,000 crore

July 1, 2019 in Reliance industries

MUMBAI: Troubled tycoon Anil Ambaniwill be leasing out or selling the Santacruz group headquarters as part of a debt-trimming exercise, people directly aware of the matter said. The group has mandated property consultancy firm JLL to advise on a transaction that, if it’s sold, could fetch up to Rs 3,000 crore. The recently built, 7-lakh-sqft HQ is located on nearly 4 acres along the Western Express Highway in Mumbai. Last week, TOI reported that Japanese giant Sumitomo bid Rs 2,300 crore for a three-acre plot in Bandra Kurla Complex. Ambani will move his group office back to Reliance Centre at Ballard Estate in south Mumbai, which is lying vacant currently. Anil Ambani gained the Ballard Estate office in mid-2005 after he and his elder brother Mukesh divided the Reliance empire among themselves. It was from the basement cafeteria of this property that the younger sibling announced the demerger formula for his set of companies from Reliance Industries (RIL), the last step in the split of the energy-to-telecom conglomerate built by their father. A Reliance Anil Dhirubhai Ambani Group (ADAG) spokesperson confirmed the development, but declined to share details at the moment. Ambani, who has vowed to repay lenders through a massive de-leveraging exercise, would prefer a long-term leasing out of the property, though the option of an outright sale wouldn’t be ruled out in the event of an attractive offer. Sources said strong, long-term lease agreements were imperative for better capital valuation in case of a sale. The latest move is aimed at making Reliance Infrastructure, which owns the property, almost debt-free. The infra developer that executes power, toll roads and metro rail projects has a debt of just under Rs 5,000 crore. The overall group debt is estimated at about Rs 75,000 crore. The plot came into the Reliance fold following the acquisition of BSES, a power distribution utility operating in Mumbai and Delhi. The original BSES hub was torn down and all Reliance Anil Dhirubhai Ambani Group companies moved into the newly constructed building in February 2016. The total FSI potential of the building is 11.2 lakh sqft, though the current leasable area is around six lakh sqft. The proposal from Reliance has met with good response from banks and insurance companies, sources said. As the younger Ambani makes Reliance Centre the HQ again, one thing that will help him will be saving on travelling time as his residence Sea Wind isn’t far from Ballard Estate. Sources: realty.economictimes.indiatimes.com

Delhi: TDI Infrastructure booked for duping buyers

Delhi: TDI Infrastructure booked for duping buyers

June 27, 2019 in Uncategorized

NEW DELHI: The Economic Offense Wing of the Delhi Police on Wednesday booked infra company TDI Infrastructure for allegedly duping two people to the tone of Rs 40 lakh for over a decade. According to the police, the complainant alleged that the builder sold them plots which were never owned by the company. Additional Commissioner of Police (Economic Offense Wing) Suvashis Choudhary told IANS that the builder has been accused of pretending to own the plots and later selling them to innocent buyers. "We have filed two FIRs in which the complainant alleged that TDI builders proposed them plots in the TDI City projected in Haryana's Kondli area," Choudhary told IANS. In one of the FIRs, the complainant, identified as Charan Singh Verma, alleged that he had purchased a 250 square yard piece of land in the said township and paid Rs 17 lakh for the same in 2009. He was supposed to pay Rs 2 lakh more after getting the possesion of the land. According to Charan, when he visited the site after a few days, he came to know that the site was neither owned by the builder, nor did the builder have any permission to develop a township in the area. Charan then contacted the builder and asked for a refund, which he is yet to receive. In another FIR, a lady alleged that she had paid a sum of Rs 21 lakh to the builder for a 350 square yard plot in the same township in 2005. However, she has not got possession of the land till date. She added that the plot was not owned by the builder and repeated attempts to get the deposit money back didn't yield any result. Sources: realty.economictimes.indiatimes.com

CPCB stops Ansal Properties’ township project, imposes fine of Rs 14.6 crore

CPCB stops Ansal Properties’ township project, imposes fine of Rs 14.6 crore

June 26, 2019 in Ansal Properties and Infrastructure

NEW DELHI: The Central Pollution Control Board (CPCB) has directed Ansal Properties and Infrastructure to stop all construction activities for its township project in Gurgaon for violation of environmental norms and also asked the real estate developer to pay Rs 14.69 crore as compensation. In its order dated June 18, the apex pollution control body held the builder guilty of discharge of untreated waste for 281 days in its 604 acre residential complex at Sushant Lok, Phase 1, in Gurgaon. The CPCB directed the chairman of the firm "to stop all the construction/expansion activities in Sushant Lok, Phase 1, Gurgaon with immediate effect". The company's spokesperson could not be immediately contacted for comment. According to the CPCB, the builder has encroached green areas and is illegally extracting ground water without a No Objection certificate (NOC) from the Central Ground Water Authority (CGWA). The National Green Tribunal was also seized of the matter and the CPCB, in pursuance to the NGT's order, issued directions to the Haryana State Pollution Control Board (HSPCB) and the CGWA to also separately levy environmental compensation for the violations. The CPCB has also directed the State Environment Impact Assessment Authority (SEIAA), Haryana, to revoke environmental clearances, if granted, and also not let Ansal Properties and Infrastructure undertake any expansion activity till it complies with all the directions. The pollution control body also asked the Haryana Electricity Board to stop power supply for any further expansion of the residential complex. The builder was asked to submit an action plan to the CPCB "regarding rectification of shortcomings... action taken report be submitted along with necessary documentary evidences..." On September 19 last year, the tribunal had directed a joint committee comprising officials from the Town and Country Planning Department, Haryana, the Delhi School of Planning and Architecture, the CGWA and the SIEAA to furnish a report on the issue. The committee, in its report, had said that the sewerage system was not proper and even rain water harvesting system for houses was not provided. It said maintenance of roads, footpath and parks was not up to the mark and system of collection of solid waste was not as per the Solid Waste Management Rules, 2016. Sources: realty.economictimes.indiatimes.com

Suraksha ARC and JM Financial invest Rs 2,000 crore in Unitech

Suraksha ARC and JM Financial invest Rs 2,000 crore in Unitech

June 25, 2019 in Unitech Group

MUMBAI: Real estate investment company Unitech group secured a Rs 2,000-crore investment from two asset reconstruction companies to complete pending projects and is scouting for more investors for additional funding as the date set by the Supreme Court to deposit money nears in July, said two persons close to the development. The company is also pursuing state governments to secure another Rs 1,000 crore in pending claims. Unitech got investments from Suraksha ARC and JM Financial to the tune of Rs 2,000 crore. Of these, around 16 projects are under JM Financial’s portfolio while seven projects are under Suraksha’s portfolio. The investments made by both the ARCs are towards working capital of the pending projects. “There are around 52 pending projects but around two thirds of the units in these projects are completed,” said a person close to the development. “In some cases there are balance customer receivables on the units sold but that would happen in the coming months,” he said. “We will not comment on any development on the issue as the matter is sub-judice,” a Unitech spokesperson said. The company is also scouting for more investors and is already in talks with a couple of players for additional investments in some of their projects. The company has been under pressure after the SC in May asked the government to explore an option to take over the group and complete the pending projects. About 17,000 buyers have invested in Unitech’s projects stuck due to working capital issues. Sanjay Chandra, managing director of Unitech is in jail after being arrested by the economic offences wing of the Delhi police in August 2017. Several homebuyers who had paid part of the money but not received the delivery of apartments dragged the company to court over the issue. The court has made depositing money a condition for Chandra’s release. The company is required to pay Rs 750 crore in the court registry and only then would Chandra qualify for bail. His company has already paid close to Rs 500 crore, said one of the sources. Asked when the company will be able to deposit the entire amount, he added that it could happen within the next couple of months. The SC is set to hear the case on July 5. The company has also dragged some state governments to court over pending claims in some of the projects, the person quoted earlier, said. Price of Unitech International ended at Rs 6.35, up 5.83% from its previous close on Monday. Unitech was trading at Rs 0.98 with no change in the stock price. Sources: realty.economictimes.indiatimes.com

DLF-GIC joint venture to build over 2.5 million sq ft mall in Gurugram

DLF-GIC joint venture to build over 2.5 million sq ft mall in Gurugram

June 24, 2019 in DLF News

GURUGRAM: Singapore’s sovereign wealth fund GIC is strengthening its alliance with India’s largest listed realty developer DLF as it seeks to participate in helping build the country’s biggest retail mall of more than 2.5 million sq ft, said two persons with direct knowledge of the development. The new project, a retail and commercial-led mixed-use development to be known as Down Town, will be constructed on a 23-acre land parcel owned by DLF in Gurgaon. The plot is on the highway opposite DLF’s 2.5 million sq ft commercial project Cyber Park. “The retail mall will be part of this 8 million sq ft project that will also have component of serviced apartments, five-star hotel and commercial development. The project will be developed in two-three phases in more than five years,” said one of the persons cited above. The development, to be executed through DCCDL, is expected to supersede the country’s current largest retail development 2.5-million-sq-ft LuLu International Shopping Mall in Kochi and DLF’s own 2-million-sq-ft Mall of India in Noida. The DLF-GIC joint venture was formed in late 2017 after the promoters of the realty firm K P Singh and his family had sold their stake in rental arm DLF Cyber City Developers Ltd (DCCDL) to the Singapore investment firm. 69839550 In addition to their commercial leasing business engagement, GIC and DLF are already working on a high-rise residential project with estimated saleable area of 7 million sq ft near Central Delhi. This project in Delhi’s Moti Nagar will be DLF’s first residential project under the newly initiated business model of selling ready-to-move-in homes. “The DCCDL platform in joint venture with GIC has been designed to take the form of a business trust, a private Real Estate Investment Trust (REIT),” said the other person. ET’s mailed queries to both GIC and DLF remained unanswered. Under the agreement with GIC, DLF can sell completed, yielding commercial projects to this joint venture or build-to-suite yielding commercial assets for this entity. It can also sell land parcels earmarked for commercial development in the near future to this joint venture. DLF has already identified certain assets and land parcels for transfer to DCCDL and has been in talks with GIC for the same. As part of transaction between DLF and GIC in late 2017, the promoter family had sold the entire 40% stake in DCCDL for Rs 11,900 crore or $1.9 billion. This deal included sale of 33.34% stake in DCCDL to GIC for Rs 8,900 crore or $1.4 billion and buyback of the remaining shares worth Rs 3,000 crore or $0.5 billion by DCCDL. Global private funds, including Blackstone Group, Canada Pension Plan Investment Board (CPPIB), APG Asset Management, Xander Group and GIC, have started investing in the retail sector to diversify their investment portfolios in the country and more funds are eyeing such alliance opportunities. In one of India’s biggest transactions to help build a property investment platform, private equity major Warburg Pincus last month entered into a $1-billion alliance with Mumbai-based developer Runwal Group to fund retail-led mixed-use projects across the country. Leasing activity in retail real estate has been on the rise and several prominent malls are witnessing robust inquiries for more space from leading brands. In the absence of incremental supplies, demand is rising as existing occupiers are seeking larger spaces. Private equity investors have revived their interest in retail real estate, after a few years of reduced focus, as part of a strategy to diversify investment portfolios at a time when consumption levels are on the rise. Indian retail real estate witnessed over 300% year-on-year jump in investments at Rs 1,000 crore during the quarter ended April, showed recent data from Cushman & Wakefield. Sources: realty.economictimes.indiatimes.com

CID arrests two directors of Galaxy Group from Lucknow

CID arrests two directors of Galaxy Group from Lucknow

June 22, 2019 in Galaxy group

PUNE: The Maharashtra Criminal Investigation Department (CID) and Uttar Pradesh Anti Terrorism Squad (ATS) arrested directors of the Galaxy Group on Friday from Lucknow. The two directors of the company had been allegedly absconding for the past 20 years. The CID arrested the directors Satishchandra Bhagwati Mishra (65) and Ramkrishna Dubey (58) both of whom residents of Kabirnagar in Khalilabad. The other accused who have been on the hit list of CID -- UP residents Pramodkunar Ganga Pande, Amodkumar Pande, Ghanshyam Pande, Maiftullah Abdul Majid Khan, Rahefirdaus Abdul Majid Siddique and Satendra Varisht Tripathi -- are still absconding. The Galaxy Group of builders had allegedly duped people at 26 places in Madhya Pradesh, Uttar Pradesh, Rajasthan and Maharashtra where offences were registered against them. The CID officials said that the accused had allegedly duped citizens of over Rs 7 crore. According to the police, the Galaxy Group and its five sub companies were registered at Lucknow. In Maharashtra, they had 105 branches. The company and its directors had allegedly cheated citizens stating they would give double interests on their investments; however, they duped the investors of their money. The CID investigations has showed that the five sub companies of the Galaxy Group were non-banking companies and weren’t even with the NBFC. The companies allegedly had no power to seek investments or deposit money of investors. The CID has so far seized Rs 4.86 crore of the money that investors had allegedly lost in the case. Residents of Wardha, Yavatmal, Nasik, Bhandara, Amravati, Chandrapur, Beed, Latur, Kolahpur and Ratnagiri had lost money in the scam. Sources: realty.economictimes.indiatimes.com

CAG questions Noida Authority over 20 builder projects

CAG questions Noida Authority over 20 builder projects

June 21, 2019 in Uncategorized

NOIDA: The Comptroller and Auditor General’s (CAG) team seems to have finally started tightening its noose around Noida Authority, as it has sought an explanation regarding allotment of plots for 20 builder projects within a month. The Authority CEO met all concerned departments on Wednesday and ordered that the replies must be sent on time. In fact, the CAG team has submitted about five pages of queries for every project, indicating that rules were bent for allocation of all these projects between 2005 and 2015. Most of these projects are of group housing societies. The CAG team has been conducting an audit of Noida Authority’s projects for the past one and a half years and was seeking documents till now. “The queries mention that in some cases the Authority took 10% instead of the requisite 30% from the developers for allotment of plots. Some other builders have still not fulfilled all terms of their contract, over 10 years since the allotment was made to them,” said a Noida Authority official. Officials said these projects in question include four projects by one particular big builder and three other big builders have also been named. More queries are expected to line up as the CAG team goes through other project details. The CAG has allegedly raised queries on how several builders are on defaulters’ list despite heavy discounts offered and why the Authority hasn’t taken any action against these groups yet. The defaulters owe over Rs 20,000 crore to the Authority, which mostly include builders of group housing societies. Sources: realty.economictimes.indiatimes.com

Unitech gets Gurugram development body’s notice for misusing groundwater

Unitech gets Gurugram development body’s notice for misusing groundwater

June 20, 2019 in Unitech Group

GURGAON: GMDA issued a notice to developer Unitech Group on Tuesday for allegedly allowing the use of groundwater for construction activities in Nirvana Country. As per the notice, the developer has given groundwater connections to buildings that are currently under construction or without an occupation certificate, which is not permissible under the norms. According to GMDA officials, they had received a complaint from a Nirvana resident stating that groundwater is being used for construction activities in the township. “We have asked the developer to cut all such connections and submit a report within seven days from the date of the notice,” a senior GMDA official said. A copy of the notice, accessed by TOI, stated that in the wake of water shortage faced by the residents of Gurgaon, the developer is directed to disconnect all such connections in conformation with the National Building Code, 2016 and MCG Act, 1994. “We’ve also directed the developer to ensure that all such under-construction buildings under the purview of the Nirvana RWA use water from sewage treatment plants for construction purposes,” the official added. There are around 50 under-construction houses in Nirvana Country. Sources: realty.economictimes.indiatimes.com

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