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SBICap Ventures starts disbursement of funds for six projects of stuck Amrapali Group

SBICap had on August 4 signed an MoU with the court receiver appointed by the Supreme Court to monitor stuck Amrapali projects for funding Rs 650 crore for six projects in Noida and Greater Noida.

SBI Cap is funding Rs 650 crore for six projects to bridge the temporary liquidity gap.

SBI Cap is funding Rs 650 crore for six projects to bridge the temporary liquidity gap.

SBICAP Ventures, the manager for the government's Rs 25,000-crore stressed-asset fund, has started disbursement for the six projects by the erstwhile Amrapali Group located in Noida and Greater Noida.

“The disbursement has started. We will be reimbursing expenses over the next two years or so as the construction progresses. Availability of capital will no longer be a deterrent for the progress of the project,” Irfan A Kazi, Chief Investment Officer of the SWAMIH Investment Fund told Moneycontrol on August 10.

SBICap had on August 4 signed an MoU with the court receiver appointed by the Supreme Court to monitor stuck Amrapali projects for funding Rs 650 crore for six projects in Noida and Greater Noida.

Also Read: Exclusive | After SWAMIH Fund, 10 banks show interest in funding stalled Amrapali projects

According to the MoU, as many as 6,947 homes will be completed with the funding.

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SBI Cap is funding Rs 650 crore for six projects to bridge the temporary liquidity gap.

The projects receiving the funds include Silicon City-1, Silicon City-2, Crystal Homes, Centurian Park- Low Rise, O2 Valley and Tropical Garden where 6,947 units are stalled of which 6,132 units are sold but homebuyers are awaiting delivery.

These projects were launched almost about 10 years ago between 2011 and 2013 and have been delayed for more than 4-5 years from their promised delivery timeline. The execution works on the said projects were hampered due to the slow inflow of funds and disruptions caused by the COVID-19 pandemic.

However, funding from SBICAP Ventures Ltd., NBCC shall expedite the progress of the works and will aim to complete the projects within the scheduled time, NBCC had said in a statement.

The Court receiver will be assisted by NBCC, which took the construction contracts for these projects after a Supreme Court order and is involved in the completion of about 22 Amrapali housing projects, which were stalled amid a fund crunch due to financial mismanagement at the erstwhile Amrapali Group.

The Supreme Court on August 2 had asked banks to relax the funding criteria for stalled Amrapali projects that include submission of collateral security and corporate guarantees, saying that lending to the projects be treated as a special case since it was being monitored under the supervision of the apex court.

The court had in 2019 asked the government’s construction arm to finish and deliver 38,159 flats by 2023 after several homebuyers sought its intervention, complaining about years of delay in handing over their homes.

The total cost of completing all stuck projects by Amrapali Group is approximately Rs 8,500 crore. NBCC is executing these projects as PMC and would get 8 percent as fees. It is not using its funds, which are being facilitated by a receiver appointed by the Supreme Court.

On July 23, 2019, the top court cancelled the registration of the Amrapali Group under the Real Estate (Regulation and Development) Act, 2016, and ousted it from its prime properties in NCR by nixing land leases for breaching buyers’ trust.
Vandana Ramnani
first published: Aug 10, 2021 09:21 pm

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