New York-based AIG Global, a private equity and realty firm, has purchased RMZ Corp’s 50% stake in a stalled mall project in Hyderabad. AIG Global plans to turn this to be a housing project.
New York-based AIG Global, a private equity and realty firm, has purchased RMZ Corp’s 50% stake in their shopping mall project in Hyderabad. Due to many reasons, the joint mall-cum-office project was stalled. RMZ Corp’s stakes are believed to be sold at Rs.53 Cr.
With some additional investment, AIG Global expects to turn the mall project into a residential project. An official with direct knowledge revealed that though the launch is expected to take place by the end of next financial year, it is subject to internal authorizations. The mall project currently spreads across to over 11 acres of land.
AIG Global Real Estate India’s Managing Director Mr. Bamasish Paul refused to speak about the issue. “The ‘dispute’ was amiably settled down,” said Mr. Raj Menda, RMZ Corp’s MD, while commenting on the issue.
The new deal will close their sharp disagreement. They were separated on their disagreement to build whether a residential or a multi-oriented project. It is believed that the project was stalled mainly due to their disagreement.
AIG Global Real Estate India had invested Rs.350 Cr earlier and had expected to exit from their investment by the first quarters of 2012, after completing the project.
As they could not exit; because the project had been stalled, they had sent legal notice to RMZ blaming them responsible for the failurenearly four months back. In return, RMZ Corp had demanded $20 million from AIG Global as compensation to their loss.
With the dispute settled, AIG Global will develop a housing project with an estimated investment of Rs.1000 Cr. According to the available sources, the project will have 1,500 housing units each ranging from Rs.50 to Rs.60 lakh.
However their decision to develop residential project has been an outcome of a Liases Foras’ recent report which stated that residential market of Hyderabad has gone up by 14%.