New Delhi: Future Group, the parent company of India’s largest listed retailer, Pantaloon Retail, plans to raise $100 million (Rs440 crore) through debt to fund an entertainment-cum-commercial enclave in Mumbai.
The 2.8-million-sq. ft project called Market City is likely to cost around $152 million, including the real estate.
Future’s Kshitij Investment Advisory Co. arm, and its unnamed partners, will invest around $52 million and the rest would be funded through long-term debt from local banks and financial institutions, company officials say. The project will be designed by Seattle-based Callison Architecture Inc. and is expected to be completed by 2009.
Kshitij Investment and its associates bought the 25-acre property in the Kurla area for about Rs221 crore (about $50 million) from a steel company in late 2005. Kshitij’s two private equity funds that invest in retail-related real-estate projects have a collective corpus of about $430 million.
“As organized retail is evolving there is a need for leapfrogging into large mix-use developments,” said Shishir Baijal, chief executive of Kshitij Investment. “There is a crying need for complete leisure and entertainment destinations.”
The company says it has completed the planning and designing of the project and construction is expected to commence as soon as they get permission from authorities.
Kshitij plans to build three Market City projects in Hyderabad, Bangalore and Chennai, each expected to cost $80 -$100 million, including the real estate.
While the UK’s Benoy Architects will design and advise the projects in Hyderabad and Bangalore, the Chennai one will be designed by New York-based Rockwell Architecture.