Property developer Rustomjee group of Mumbai will borrow up to ₹1,100 crore from HDFC Ltd in construction finance to complete a luxury housing project that it took over from DB Realty last year.
Rustomjee has entered into an agreement with HDFC Ltd as strategic financial partner to finance a five-year-old project in Prabhadevi, which DB Realty had exited early last year due to funding issues.
“Our arrangement with HDFC is for about ₹1,100 crore. HDFC will be providing all the capital required for this development. Of course, sales will continue to support as well," Boman R. Irani, chairman and managing director, Rustomjee group said in an interview, adding the funds will be disbursed “as and when it is required".
The project, now called Rustomjee Crown, will have around 700 units of three to five bedroom luxury flats and is estimated to fetch ₹5,800 crore.
The apartments ranging between 1,330-2,528 sq.ft will be sold at ₹8-18 crore.
In 2009, DB entered into a joint development agreement with Bhishma Realty, a unit of the Thackersey family which owns the 5.75 acre mill land where the project is coming up.
“Going forward, we will be responsible for everything. All decisions will be made by us. We will take control over the project right from funding to execution of the project," Irani said.
Rustomjee on Tuesday relaunched the project that had stalled over the last one year.
As part of its marketing efforts, DB Realty had offered helicopter rides to its clients over the project site in 2016. The project later stalled due to various reasons, mainly lack of funding.
DB Realty had invested ₹1,200-1,500 crore through debt into the project, said a person, who did not want to be identified.
The project has been conceptualized by leading architect Hafeez Contractor. Rustomjee has hired Bangkok-based interior design firm PIA as well.
“It gives me immense pleasure to be part of the launch of South Mumbai’s gated estate. HDFC Ltd is the strategic finance partner for Ruistomjee Crown and we are confident this project will refine the way homes and living spaces are imagined in this part of the city," HDFC chairman Deepak Parekh said in the statement.
Of the total 700 flats, around 250 have been sold. Rustomjee expects to complete the whole project by December 2022.
Mint reported in November that more than half of upcoming luxury skyscrapers in Mumbai’s Worli and Prabhadevi are struggling to find buyers.
Lower Parel, also in the vicinity, is facing similar problems as several residential high-rises have mushroomed in the midst of office towers in the last few years.