Bengaluru: Real estate firm Prestige Group has bought 14 acres of land in Hyderabad’s Kokapet area for ₹200 crore that will be built as a mixed-use development project, said a top company executive.
The Bengaluru-based developer will build around 1.6 million sq ft of mid-income homes as part of the residential project and another 1.8 million sq ft of commercial office space.
“The company already has strong presence in Hyderabad and we plan to strengthen that," said Prestige chief executive Venkat K. Narayana.
Hyderabad comprises around 16% of Prestige’s ongoing project portfolio, second only to Bengaluru which is at 66%. The Hyderabad property market has been performing well, despite the slowdown and the liquidity challenges. The southern city has the least unsold inventory among the top seven cities at around 23,890 units as of September, 2019, compared to 27,000 units a year ago, as per data by Anarock Property Consultants.
“Prestige’s net debt rose by around ₹350 crore quarter-on-quarter to ₹8470 crore mainly owing to the land acquisition in Hyderabad for ₹200 crore and other balance payments towards stake acquisitions in projects. While the rise in debt levels is a cause for concern, it is cushioned by operational annuity assets and which will have exit rental income of ₹960-1000 crore by March, 2020 and ₹3000 crore of completed inventory in its residential projects," said Adhidev Chattopadhyay, research analyst, ICICI Securities Ltd.
In October, Prestige and real estate firm DB Realty Ltd entered into a 50:50 joint venture to develop a mixed-use project spread across 7.7 acres in Delhi’s Aerocity.
In 2019-20, Prestige has already launched 7.88 million sq ft of residential, office and retail projects and has a pipeline of 18.9 million sq ft of upcoming launches across cities such as Bengaluru, Noida, Mumbai and Hyderabad.