HDFC extends funding of Rs 200 crore to DivyaSree’s Bengaluru commercial project – ET RealEstate

MUMBAI: Housing Development Finance Corp has extended Rs 200 crore funding to realty developer DivyaSree Infrastructure Projects for construction of a part of the commercial project Technopolis in Bengaluru, said two persons with direct knowledge of the development.

The non-banking finance company will charge below 11% interest for the loan with a total tenure of 48 months.

The construction finance loan is expected to be repaid in one single bullet payment of Rs 200 crore at the end of 48 month from the date of first disbursement or earlier at the option to be exercised by HDFC.

The loan will be serviced through monthly interest during this period.

The Bengaluru-based developer will be using the funds for construction of nearly 1 million sq ft development spread over 10 floors of Technopolis project.

The office building has been designed and being constructed as a built-to-suit project for a specific customer.

“As part of the agreement, the borrower has created an exclusive mortgage and charge over the said property in favor of HDFC,” said one of the persons mentioned above.

Technopolis is a 68-acre mixed-use project with a total development potential of 5.5 million sq ft, including commercial office spaces, residential villas and luxury apartments.

The under construction office spaces in this project are being developed as built-to-suit spaces for tenants like Xerox, Deloitte, Thomson Reuters, and Landmark Group totaling around 2.5 million sq ft.

ET’s email queries to HDFC remained unanswered until the time of going to press. DivyaSree’s Managing Director Bhaskar Raju declined to comment for the story.

Last year, private equity player Kotak Investment Advisors announced a $400 million fund in partnership with DivyaSree Developers to build and acquire commercial office assets across the country.

The developer has developed over 19 million sq ft office spaces since 2005 and has 6 million sq ft offices under construction across Bengaluru, Hyderabad and Chennai. It counts Cisco, Dell, Oracle, Google, Accenture, IBM, Wells Fargo, Cognizant, UBS among its clients.



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High home loan demand triggers interest rate war – ET RealEstate

̥MUMBAI: A surge in demand for home loans in October has triggered a rate war. Kotak Bank is now offering home loans at 6.75% — the second reduction in less than a month. A host of banks are offering loans at 6.8% to 7%, resulting in the spread between these and government bonds narrowing down to 80 basis points (100bps = 1 percentage point).

Banks say that home loans are a safe bet and this is the only segment growing in double digits. Demand has been triggered because of work from home (WFH) needs, discounts by builders, reduction in stamp duty rates and interest rates being at an all-time low. The frequent changes in pricing among lenders seem to indicate that a rate war is brewing as the banks compete to grow the home loan book, which is seen as the safest category of loans.

In the last few days, Bank of Baroda and Union Bank of India had slashed their home loans to 6.8% and 6.9%. SBI recently announced discounts of up to 25bps on loans above Rs 75 lakh for customers applying from its app Yono. HDFC also offers loans at 6.9%.

Speaking to TOI, Kotak Bank group president (consumer banking) Shanti Ekambaram said that the lender was seeing an increase in demand for housing as the shift to WFH had resulted in homeowners looking for larger accommodation. Also, developers and state governments were offering additional incentives to home buyers.

“We are seeing demand back at pre-Covid levels and we want to open our doors to home loan customers as part of our acquisition strategy for long-term customers,” she said. According to Ekambaram, home loans were the best asset class, and offering the lowest rate enabled the bank to attract top quality customers.

While announcing the results, Punjab National Bank MD & CEO S S Mallikarjuna Rao said that home loans have gained momentum and are heading to pre-Covid levels. Home loans have been a major driver of credit, growing nearly 10% on a year-on-year basis to Rs 84,000 crore.
High home loan demand triggers interest rate warFor HDFC, home loan disbursements in October 2020 have been the second-highest in any month in the institution’s history. Mumbai saw the highest demand followed by Delhi and Bengaluru, while Hyderabad and Chennai were a bit slow. “The demand that we are seeing is largely transactions that were initiated post-Covid and is not pent-up demand. We hope that this will be sustained,” said HDFC VC and CEO Keki Mistry.

Ekambaram says that the renewed demand for housing is an opportunity for Kotak Bank, which was not part of the top-five home loan lenders. The bank now offers home loans at 6.75% for salaried borrowers with a Cibil score of over 750 and loan-to-value of 80% and below. For self-employed borrowers, the rate is 6.85%, all other conditions being similar. The same rates will be available for borrowers seeking balance transfers.



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HDFC lends Rs 2,600 crore to DLF & Hines’ joint venture project in Gurugram – ET RealEstate

NEW DELHI: HDFC has extended construction loan worth Rs 2,600 crore to Hines and DLF‘s joint venture which plans to develop a commercial project in Gurugram, the company said in a media release.

In its investor’s presentation recently uploaded in the BSE, DLF had said that construction credit lines have been sanctioned while approvals are underway and construction of the project will commence thereafter. It is scheduled to be complete in 2023-24.

In 2018, DLF had purchased the commercial land parcel spread across 11.76 acres through an auction process conducted by HSIIDC for about Rs 1,500 crore, according to media reports.

The joint venture was formed in March 2019 when DLF announced sale of 33 per cent stake to Hines in the commercial project. DLF’s subsidiary DLF Home Developers and Hines group firm Green Horizon Trustee had entered into a JV where the latter has an option to increase its stake to 49 per cent.

DLF had reported a consolidated loss of Rs 71.52 crore in the first quarter of the financial year 2020-21. Its profit after tax (PAT) stood at Rs 413.94 crore during the corresponding quarter previous fiscal, the company had said in its BSE filing.



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