After acquiring 51 percent stake in a 1.3 million square feet under construction luxury project in Pune, Tribeca, the developer of multiple Trump Towers in India, has recently signed Memorandum of Understanding (MoUs) for two more similar projects in Pune and is hoping to double its portfolio to 9 million sq ft in 2021, Kalpesh Mehta, founder of Tribeca told Moneycontrol.
“In February and March, we entered MoUs for two more projects in Pune spread across 2.2 mn sq ft and by the end of 2021 we would have doubled our pan-India portfolio from 4.5 mn sq ft last year to almost 9 mn sq ft,” he said.
The company signed an MoU for a 1.5 mn sq ft project in Pune last week and will be signing on a 0.7 mn sq ft brownfield project in the same micro market this week.
“The sale value of the 4.5-5 mn sq ft is so far close to about Rs 3,500 to Rs 4,000 crore which would going forward be about Rs 8,000 crore by July this year. Almost half of these projects are brownfield projects,” he said.
The company has so far raised and restructured about Rs 280 crores in financing for stressed projects in India and plans to raise another Rs 600 crore for new projects.
“We have managed to get these projects funded/refinanced on a deal by deal basis while we continue to work on raising a stressed asset platform fund,” he told Moneycontrol.
It must be noted that in July 2019, the company was in the process of raising Rs 2,000 crore debt fund to invest in stuck real estate projects. The platform was to acquire projects under the development management agreement and joint venture models.
Last month, Tribeca, acquired 51 percent stake in a 1.3 million square feet under construction luxury project in Pune. The project Voyage to the Stars was launched by Acropolis Developers in 2015. It ran into financial difficulties in 2019. The Rs 1,100-crore project had a debt of around Rs 180 crore from ICICI Bank and Tata Capital.
The company is witnessing fair amount of traction in the Pune market as a result of stamp duty cuts announced by the Maharashtra government. The window ends on March 31, 2021.
“We will be launching the Voyage to the Stars project this month. The project has a mix of inventory. Some of the towers in this project have already received an occupation certificate, some are expected to be completed in the next 6-9 months and others in the next 15-20 months. The project also has a 2.5 acre rooftop terrace, perhaps the largest in the country,” he said.
The company is also targeting sales of Rs 1,000 crore to Rs 15,00 crore by March 2022 from both its brownfield and greenfield projects spread across the country.
“In terms of sale value we are looking at generating somewhere between Rs 1,000 to Rs 1,500 crore by March 2022 across projects. We hope to generate a couple of crores from the sale of unsold inventory in the Trump project in Kolkata and around Rs 500 crore from the Trump project in Gurgaon. We are expecting Rs 500 crore from the sale of units in the brownfield project in Pune and a couple of crores from the Noida project,” Mehta said.
Consolidation among real estate developers wherein the most capable ones with a consistent track record of execution, fiscal discipline, transparency, and corporate governance, will gain the majority of the market share and thrive during and after COVID-19.
Tribeca is eyeing more such consolidation opportunities across the country as more lenders, developers and homebuyers are looking at completion of several stalled projects.
“Taking on brownfield projects and completing them is an opportunity for us. Once the stamp duty waiver comes to an end in Maharashtra on March 31, sales may get impacted and the resultant stress in real estate projects may throw up an opportunity for us,” he said, adding “we would continue to look at such projects across Maharashtra and NCR markets. I like the risk rewards attached to these projects compared to greenfield ones. Closure of these projects too is faster to achieve.”
The Pune project is the second such project acquired by the company in the last one year after inking a similar transaction in Bengaluru. In 2019, Tribeca had partnered with KKR to acquire Rs 100 crore worth of inventory in Mantri Espana project in Bengaluru.
“Bengaluru was not a brownfield project but a set of completed/OC ready apartments that we bought from Mantri. We are witnessing steady sales for ready apartments during the pandemic. Besides, the stress in the system got solved not through NBFC and bank money coming in but due to the sales volumes going up. If those sales slow down, opportunity will open up again,” he added.
In 2019, Tribeca announced a tie-up with Logix Group to develop mixed-used real estate project in Noida comprising offices, residential flats and a shopping mall, at an investment of Rs 250 crore.
In March 2019, HDFC Capital Advisors and Tribeca set up a platform to develop mid income housing projects in Mumbai and NCR. The platform was to invest Rs 500 crore through debt and equity.
“Of the Rs 500 crore, as much as Rs 140 crore has been deployed from the HDFC platform for the project in Gurgaon,” he said.
With the market sentiment improving this year, the company is targeting greenfield projects as well. “We are entering 2021, especially in Maharashtra, with a healthier real estate market situation. We will be looking at doing more greenfield projects sooner than we expected six months ago,” he added.
