HDIL Will Buy Land To Relocate 80,000 Slum Families

Housing Development and Infrastructure Ltd (HDIL), India’s third largest developer by market value, plans to raise Rs1,000 crore within a year to buy land and relocate 80,000 slum families for the Mumbai airport modernization project. The project will entail the country’s single largest rehabilitation exercise, even bigger than the Dharavi project, which will relocate 55,000 families.
With a land bank of 2,500 acres (valued at Rs21,000 crore in 2007), HDIL, which started off as a finance firm, is now one of the largest landowners in Mumbai, with residential and commercial projects in Pune, Kochi and Hyderabad.
The company’s forte, though, is slum redevelopment. After getting the state government’s approval this May, HDIL became the rehabilitation agency for the airport project in which 20,000 slum families will be shifted in the first go.
HDIL has bought a 53-acre plot in suburban Kurla, where the earlier Premier Automobiles Ltd factory was located, for Rs1,900 crore. The remaining 60,000 families would be moved in two phases, 30,000 families in each.
“We have some land reserve for the resettlement but, we will raise Rs1,000 crore through debt to buy more land in the vicinity of the airport to relocate the remaining people. We will buy land which is within 1Km from the airport,” said Sarang Wadhawan, managing director of HDIL.
HDIL, which has completed about 28 million sq. ft of construction, follows a business structure in which it acquires large tracts of land, develops the infrastructure and sells it to other developers. Out of the 276 acres of encroached land in the airport project, HDIL’s share is 106 acres.
“We are looking at a hospitality venture along with commercial space there. We will also develop and sell a portion of this land,” said Wadhawan. The remaining 170 acres will have to be handed over to the Mumbai International Airport Pvt. Ltd for commercial development, a joint venture between the GVK-SA consortium, which is developing the airport, and the Airports Authority of India. HDIL said it expects to earn Rs15,000-18,000 crore of revenue from the rehab programme.
HDIL is also planning to further expand its new businesses oil and gas, and media. It plans to set up a 150MW power plant on the Fiat land in Kurla which will have 40 residential towers to house the slum dwellers. HDIL is already building a coal-fired power plant on its 2,300 acre, multi-product SEZ in a Mumbai suburb, and a port there.
“The objective of expanding our power business is to facilitate our core business which is real estate. We are also looking at more acquisitions in the power sector,” said Wadhawan. The firm has bid for several oil blocks under India’s new exploration and licensing policy that will speed up oil exploration in the country.
HDIL’s most recent expansion plan is in the media and broadcasting space where it has picked up a stake in Sri Adhikari Brothers Media and Techocraft Media, that runs the Marathi channel Mi Marathi and news channel, Live India. Under HDIL Entertainment, a subsidiary of HDIL, it also plans to launch three multiplexes in suburban Kandivali, Goregaon and Bhandup in the next one year.
Akshaya Kumar, chief executive officer of Parklane Property Advisors, a Mumbai-based property consultancy firm, says that real estate developers stepping into new businesses is a fairly recent phenomenon. “Historically, only DLF had cement and power businesses which it later exited. Now, in a tight real estate market, many developers are attempting at new sectors with good potential by hiring expertise and using their network.”

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