Unitech Corporate Parks puts Gurgaon property on block

Unitech Corporate Parks Plc (UCP), the real estate investment company listed on London's Alternative Investment Market in which developer Unitech Ltd holds a 40 per cent stake, has decided to put one of its largest assets in India on the block with a valuation of Rs 3,000 crore (Rs 30 billion).

The high-rise Infospace Dundahera, coming up in the 28-acre information technology-special economic zone (IT-SEZ) in Gurgaon near Delhi, is expected to be completed by 2013-end.

The project commands 1.9 million sq ft of space and it already has pre-lease commitments of up to 64.5 per cent of the lettable area (the net area plus a proportion of areas such as lift lobbies, service corridors, etc). The valuation of the company has been undertaken by independent valuers.

The project is being jointly developed by the local landowner and the company and 28 per cent of the proceeds from monetisation will go to the landowner.

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When contacted for comments, Donald Lake, non-executive chairman of UCP, said without getting into the specifics: "The board is working actively on all future options for the company and ways to monetise the assets as they progress. We continue to believe that the maximum value for shareholders will be achieved by creating investments that are substantially physically complete, and so our strategy continues to be to further the projects as quickly as tenant demand permits."

He confirmed that the project was expected to be completed by the end of 2013.

UCP is developing five more assets, including two projects in Noida, which will be completed by 2016, and another in Gurgaon, also with 2016 deadline.

It's Kolkata property (43.6 per cent of the space has been leased out) is expected to be completed by 2021, while the one in Greater Noida will be completed in 2023.

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The Unitech group, which was engaged in a bitter battle with its Norwegian partner Telenor, recently smoked the peace pipe after agreeing to sell its 33.75 per cent stake in their telecom joint venture, Unitech Wireless, for an undisclosed amount.

The remaining equity in the company was held by Telenor. With this move, the group marked its exit from the turbulent telecom business and has not decided to stick to its knitting.

While it has reduced its debt to a comfortable Rs 5,300 crore (Rs 53 billion), the deal will help it in further reducing its debt exposure.

UCP's pre-tax profits for the first six months of the current financial year rose 63 per cent to 㾽.8 million (Rs 156 crore today). The value of the portfolio went up 16.2 per cent and the total area for which it has got leasing commitments is to the tune of 6.43 million square feet already.