Reality Major's REIT plans delayed

IndiaBulls RealEstate and Unitech Ltd. have put their Singapore REIT plans on hold siting volatile market conditions. DLF may follow too.

Unitech, IBREALEST & DLF had lined up a $0.5Bn,$1Bn & $1.5Bn. offer. Unitech and IBREALEST were exploring private placement, according to Business Standard. DLF too might delay the offer or go for $500Mn. private placement.

Indian developers, hit by soaring land costs and curbs on bank loans, are looking to tap REITs, which are not yet allowed in India, although draft guidelines for them were issued in December.

Read the article on Mint

Hilton-Dlf to form joint venture in hotel business

Hilton Hotels Corporation will create a joint venture company (JV) in India with DLF Limited (DLF). The joint venture company plans to develop and own 75 hotels and serviced apartments over the next seven years. The formation of the joint venture is pending receipt of formal written approval from the Government.

The JV-owned hotels will represent several brands from the Hilton Hotels Corporation portfolio, including Hilton Hotels, Hilton Garden Inn, Homewood Suites by Hilton and Hilton Residences. The JV Company will develop and build these properties, while Hilton will manage them.

DLF will hold 74% in the JV Company, and Hilton will hold the remaining minority stake as a symbol of its commitment to the venture. Over the next five to seven years, Hilton will invest up to USD 143 million in the JV Company, before any consideration of debt.

The initial stage of the joint venture will involve 20 hotels in a number of key locations, including Chandigarh, Chennai and Kolkata. A large number of these hotels are expected to be Hilton Garden Inn properties -- a business hotel brand, offering focused services. Beyond the initial 20 sites, the JV Company will continue to identify and acquire sites and undertake new hotel developments in due course of time.

Source: INR News

Nakheel, DLF form JV for infrastructure development projects worth $12 bn

Delhi-based real estate giant DLF is reportedly forming a joint venture with Nakheel, the largest property development company in the United Arab Emirates. The JV is being formed for mega infrastructure development projects at an estimated cost of $10-12 bn.

Each project, one near the National Capital Region and the other in Maharashtra, along the coastal region, would be spread over 20,000 acres, and would involve the development of industrial infrastructure and township components, including residential, commercial, retail and recreational centres. Each partner would bring around $3 bn to the table while the remaining would be financed through debt.

Nakheel is behind some of the most iconic projects in the Middle East such as The Palm, The Dubai World and Dubai Waterfront. Nakheel currently has 17 major projects, worth more than $30 bn under development.

Read more in The Economic Times article.

DLF forms life insurance JV with Prudential Financial

A day after HSBC, Canara Bank and Oriental Bank of Commerce announced their three-way life insurance tie-up, real estate giant DLF has joined hands with US-based financial player Prudential Financial, Inc. (PFI) for a foray in life insurance business. The two partners will invest about $250 mn (Rs. 1000 crores) over the next ten years in the venture. Under the terms of agreement, Prudential will have 26% stake and the remaining 74% will be held by DLF Group in the JV. The joint venture has been christened as DLF Pramerica Life Insurance Company Limited. Pramerica is a brand name used in select countries by Prudential Financial. The company will initially have a paid-up capital of Rs. 100 crores, including Rs. 26 crores by Prudential. Both the partners would have representatives on the Board, while Prudential would take care of the operations. The company would be based in New Delhi

The company is applying for a license from the Insurance Regulatory and Development Authority (IRDA), and hopes to start operations by early 2008. Prudential is in talks with several banks and non-banking finance companies (NBFCs) to distribute its insurance products, apart from having its own distribution products.

Prudential Financial has about $616 bn of assets under management by December-end 2006 and operates in the US, Japan, Mexico as well as in many countries of Asia and Latin America.

Read articles in The Economic Times and Business Standard.