IL&FS planning to raise Rs 5,000-6,000 crore by selling its Non-core Real Estate Assets.

By Abhay Harish Shah, Realty Quarter

Infrastructure Leasing & Financial Services (IL&FS) is planning to sell its non-core real estate assets, which also includes its headquarters in Mumbai. In order to reduce debt and improve cash position Infrastructure group is planning to raise Rs 5,000-6,000 crore by selling its non-core assets.

There are approx 50 properties, including commercial and residential properties, land and land development rights held under different subsidiaries across the country are on the sale list.

These encompass the whole of its Hill County Property share, including Hyderabad and Vijayawada, that holds almost 500 acres of land and development rights.

Non-core assets monetization is part of the new IL&FS Board’s strategy to raise cash to pare the group’s debt of more than Rs 94,000 crore and create liquidity.

The Group could obtain Rs 5,000-6,000 by the sale of real estate assets, according to independent calculations.

According to the sources, the headquarters in the Prime Bandra Kurla complex of Mumbai with a number of reputable tenants are expected to attract more than Rs 1,500 crore. The office complex consists of tenants such as private equity fund Carlyle and financial services firm Avendus.

The BKC, which has taken over Nariman Point as the financial hub of the city, is in high demand for office space.

80% of Hill County Property belongs to IL&FS and the board has started selling the whole stake. The Maytas properties of Hill County were formerly set up by Satyam Computer Services’ Ramalinga Raju. In 2011, IL&FS bought it.

The sales process is anticipated to conclude by the end of this fiscal year, including selecting independent property consultants, inviting the public to express interest, selecting eligible bidders, submission presentations and due diligence, submitting a final tender and concluding a deal.

The new Board has already started selling a number of Group assets, including energy, roads and technology, and part of the financial services within the overall resolution process for the IL&FS group.