Sterling, HDFC JV to set up township

Sterling Developers and HDFC Realty Fund, which forged a 50:50 joint venture in December last year, are to develop a township in Bangalore's Whitefield area at an estimated cost of Rs 3,000 (Rs 30 billion) to Rs 4,000 crore (Rs 40 billion). This includes the cost of the land.

The project will be spread over an area of more than 150 acres with a total built-up area of 20 million sq ft, said Ramani Sastri, managing director, Sterling Developers.

The first phase of the project will include 150 high-end villas with a total built-up area of 4 million sq ft. The price of each villa will vary between Rs 2 crore (Rs 20 million) and Rs 3.5 crore (Rs 35 million) depending on the size. The second phase will comprise 2,000 apartments.

Sterling is also in the process of acquiring two infrastructure companies based in the south. Although Sastri declined to name the two companies, he said the valuation of each of these companies was approximately Rs 100 crore (Rs 1 billion).

Also, Sastri is optimistic the acquisitions will be completed by the end of this financial year. He also did not divulge how the money would be raised for these acquisitions.

While one of these companies has expertise in engaged in roads and bridges, the other is engaged in dams and power generation.

Sterling is also set to make an investment of Rs 400 to Rs 500 crore (Rs 4 to Rs 5 billion) for its education and hospitality sector plans. The realty firm is looking to debut in the hospitality industry with one hotel each in Hyderabad and Bangalore. It bought the land for these hotels last year.

For managing these hotels, Sterling is in talks with one large international chain and one leading domestic chain.

"We are undecided on whether the hotels should be in the 4- to 5-star category or in the budget segment. The two chains that we are in dialogue with already have established brands in all these categories," said Sastri. Sterling owns one International Baccalaureate-certified school in Bangalore and is planning a second in Lonavla.

The company is looking at opening a third school in either Noida or Gurgaon.

Posh Push

The first phase will include 150 high-end villas costing between Rs 2 crore (Rs 20 million) and Rs 3.5 crore (Rs 35 million).

Sterling is in the process of acquiring two infrastructure companies based in the south.

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