Adarsh Developers refinances Rs 3,000 crore debt in two years, ET RealEstate

October 27, 2023

Adarsh Developers has refinanced debt of about Rs 3,000 crore in the past two years and has sold land, along with raising as part of financial restructuring ahead of its next phase of growth, said Adarsh group chairman BM Jayeshankar.

The Bengaluru-based real estate firm plans to invest about Rs 7,000 crore over the next seven years to develop 25 million square feet of residential assets across Bengaluru and enter the plotted development segment, he said.

This includes ongoing apartment projects spanning 17.10 million sq ft, plotted developments of 2.80 million sq ft and Villa developments of 4.62 million sq ft.

“The focus was to turnaround the company and reduce debt. We have brought down our debt substantially, and plan to further reduce it. The average sale now is 450 units quarterly as opposed to 50-60 units earlier,” Jayeshankar told ET.

According to sources, earlier this year HDFC Capital Advisors, a subsidiary of India’s largest private mortgage lender, HDFC, agreed to invest around Rs 1,600 crore into a portfolio encompassing 12-13 residential projects developed by Adarsh Developers. The projects, located in Bengaluru, cover a total area of 10 million square feet. The portfolio includes both ongoing and approved projects.

The builder has raised capital from Oaktree and Edelweiss too.

Adarsh Developers sold two of its land parcels in Bengaluru to Godrej Properties for about Rs 180 crore last year. The company is focused on luxury homes, priced at more than Rs 1.4 crore in Bengaluru, and just 20% of its portfolio comprises projects targeting the mid-income group.

“The capital injection serves various purposes, including supporting growth, ensuring working capital and facilitating the completion of ongoing projects. We are also foraying into plotted development as the turnaround is quicker than in any other asset class,” said Jayeshankar.

According to Knight Frank, a property consultancy firm, residential demand across the country increased 12% year-on-year in the September quarter to 82,612 units, a quarter-on-quarter increase of 7%. It marked an almost six-year high in quarterly sales volume. Sales traction was higher across all markets in year-on-year terms, with Bengaluru witnessing 19% year-on-year growth in sales in July-September.

Adarsh Developers is engaged in projects in the planning and development stages and has completed around 19 million sq ft of assets so far. The company has a land bank of 11.5 million sq ft in Bengaluru.

  • Published On Oct 26, 2023 at 12:30 PM IST

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