Real estate developer Gaurs Group has raised ₹500 crore from Kotak Mahindra Bank, through its subsidiary Kotak Mahindra Prime Ltd, to pace up construction work at Gaur City II, part of integrated township Gaur City and commercial project Gaur City Centre, in Greater Noida West.
This is the second debt transaction by the developer, after it raised ₹640 crore from PNB Housing Finance Ltd for a housing project and a shopping mall development, earlier in the year.
While Gaur City II is part of the 237-acre integrated township project Gaur City, Gaur City Centre has a shopping mall, multi-level parking and a hospital.
The debt funding comes at a time when non-banking financial companies, or NBFCs, who have been a key source of funding for builders are undergoing a liquidity crisis. Property markets like Delhi-National Capital Region, India’s largest property market, have been impacted the most given the slow sales and because developers need debt to maintain the pace of construction, plan launches or repay loans.
“The investment would be used to pace up the construction at two of our projects in Greater Noida West. We have had a good run since two years and have sold good numbers which has helped us to complete projects within stipulated time. We also have excellent track record and relations with banks which has made us a preferred partner for such big fund deals," said Manoj Gaur, managing director, Gaurs Group in a statement.
NCR-based Gaurs Group also said that in March, it has clocked sales of over 600 units. “Kotak is a respected lender in the real estate space. The deal of the magnitude has been possible due to the consistent performance delivered by the Gaurs Group in last several quarters. This deal will cut down financing costs of the group significantly," said Vineet Singhal, group chief financial officer, Gaurs Group.
A spokesperson of Kotak Mahindra Group said, “We are extending the debt for development of quality residential and commercial projects. We value borrowers with good track record and who are progressively building organisational capabilities to deliver value to all stakeholders on a sustained basis."
Gaurs Group is currently developing group housing and commercial projects in Greater Noida West, Siddharth Vihar (Ghaziabad) and Yamuna Expressway. The group has also announced its entry into affordable housing along with its expansion in education and hospitality segments.