Realty major DLF and Singapore's sovereign wealth fund GIC are planning to invest about Rs 1,250 cr over the next four years to construct a housing project in the national capital. In September 2015, the GIC had invested Rs 2,000 cr to buy 50 per cent stake in DLF's two upcoming housing projects at Moti Nagar in central Delhi.
DLF had entered into a joint venture with GIC for these two projects, which will be called 'Midtown', having total development potential of about 7 mln sqft. The JV has started construction of the first phase of this project that involves 2.5 mln sqft of built-up area.
As per the new business model adopted by the company, DLF will open sale of flats in this project after it gets occupancy certificate from the government authorities. The company is expecting to sell apartments in this project for over Rs 20,000 per sqft.
This project is part of the DLF's overall development of 38 acre land parcel at Moti Nagar, Delhi that it bought in 2007 from DCM Shriram and Lohia Group for Rs 1,675 cr.
The company, on its own, has developed and sold about 2,850 flats in three phases of 'Capital Greens' project. About 1,500 units for economically weaker section and a commercial building has also been developed on this site.
DLF had first launched this project in 2010 at a price of Rs 4,500 per sqft and the current price in the secondary market for completed units is about Rs 17,000 per sqft.
For further development on this prime land parcel, DLF had formed JVs with GIC.
In the national capital, there are only few housing projects from private developers. DLF currently has completed inventories of Rs 13,500 cr, largely in Gurugram, which it expects to sell over the next 5-6 years.
Meanwhile, it will continue to build projects to create stock of completed units. After this JV for housing projects, DLF has formed a separate JV with GIC in the commercial segment.
In December last year, DLF promoters sold 33.34 per cent stake in rental arm DLF Cyber City Developers Ltd (DCCDL) for Rs 9,000 cr. DLF's stake in the JV firm DCCDL is 66.66 per cent.