Runwal Group buys over 20-acre land parcel in Thane for Rs 471 crore

Real estate developer Runwal Group has acquired an over 20-acre land parcel in Thane near Mumbai from a chemical company PB Global for around Rs 471 crore, said persons with direct knowledge of the development.

Both Runwal Group and PB Global have already entered into a definitive agreement for the land transaction and the registration of the entire deal is expected to be completed in tranches.

The first part of the deal for around 9-acre plot, which is a freehold land parcel, has already been concluded for over Rs 204 crore. Other tranches will be concluded based on certain approvals from the government authorities.

“The agreement for the land transfer between one of the affiliate companies of Runwal Group and PB Global was concluded a few days ago. The first part of the deal has already been registered and the rest will also be done in the next couple of weeks,” said one of the persons mentioned above.

The contiguous land parcel is located in close proximity to the developer’s existing retail property R Mall in Ghodbunder locality of Thane. The plot used to house a factory that had stopped its operations years ago.

The PB Group was established in 1960 as Pesticides Ltd , a leading producer of pesticides and agrochemicals. The company has since expanded to be a group with diversified interest across sectors such as chemicals distribution and consumer electronics.

Runwal Group is financing this land acquisition through its sales and accruals. The group, counted among the large realty developers in the country, has recorded sales worth over Rs 6,050 crore for the financial year 2021-22. The developer has recorded a year-on-year growth of over 30% and has, over the last 3 years witnessed revenue growth of over 100%. Runwal holds the second largest inventory of land banks in Mumbai.

ET’s separate email queries to Runwal Group and PB Global remained unanswered until the time of going to press.

Transactions for land parcels have started to gather momentum again with many deals including outright acquisitions and joint ventures in key property markets of Mumbai, Pune, Chennai, Hyderabad and Bangalore either being closed or expected to close this year. The increased demand for land parcels is led by sustained recovery in the housing market and buoyed warehousing and data centers space.

In the backdrop of the increasing preference for alliances and joint development of land holdings, this will be one of the few instances of an outright purchase in recent times. Over the past few years, several realty developers have reworked their business strategies to focus on asset-light models, such as joint development, to reduce the upfront capital cost and cope with liquidity pressure.

Over the last few years, Mumbai’s central suburbs and neighbouring Thane’s micro-markets have been emerging as a new hotspot for residential developments. Several real estate developers have either acquired land parcels on an outright basis or have entered into agreements to jointly develop plots in this pocket.

Last year, billionaire investor and founder of DMart , Radhakishan Damani acquired an 8-acre land parcel in Thane from Mondelez India, formerly Cadbury India, for nearly Rs 250 crore.

In 2019, Singapore-based global investment firm Xander Group ’s retail arm Virtuous Retail South Asia (VRSA) acquired about 20 acres in Thane from textile firm Raymond NSE 5.14 % for over Rs 710 crore. Prior to that, Godrej Properties NSE 3.00 % had also acquired a 4-acre parcel on Ghodbunder Road to develop a residential project.

Source: economictimes.indiatimes.com

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