Sri Lanka firm enters Indian property space

Wednesday, 26 January 2005, 08:00 Hrs
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BANGALORE: Ceylinco Consolidated, the leading corporate group in Sri Lanka, has tied up with Shriram Properties Ltd to develop commercial and housing properties in Bangalore and Chennai.

The Colombo-based conglomerate and Shriram are setting up a joint venture to build integrated townships in Bangalore and Chennai, which have emerged as boom cities, riding on economic rebound, driven mainly by IT, BPO, pharma and automobile sectors.

The townships, to be spread over 100 acres on the outskirts of both the metros, will be built in the next four-five years. They will have residential buildings, service apartments and commercial complexes with state-of-the-art facilities and amenities for outright purchase or leasing.

The combined investment in the two townships is estimated to 12 billion.

The partners will also develop large commercial properties for locating IT parks and shopping malls in Bangalore as well as Chennai. The investment in Bangalore will be about 1.2 billion. A similar investment is likely in Chennai.

"As one of the largest corporate entities in Sri Lanka with 100 subsidiaries and 30,000 employees, we have made a mark in diverse sectors of the economy such as banking, insurance and financial services, real estate, diamonds, jewellery, tourism and IT.

"Though we made a modest entry into India with Shriram in non-banking financial services, this is the first time we are foraying into the Indian property market that is set to witness a (major) growth in the coming years," Ceylinco director Sicille Kotelawala told reporters here Tuesday.

The $600-million Ceylinco group is also planning to open a chain of restaurants in Bangalore and Chennai to introduce authentic Sri Lankan cuisine to Indian gourmets.

For variety, the restaurants, christened Sitar, will also have continental and south Indian dishes.

"The spirit of innovation and passion for excellence has made us a global brand in the island country. The growing Indian property sector has given us an opportunity to extend our operations here with Shriram, a leading player in this space," said Ceylinco deputy chairman Hiran de Silva.

According to Shriram CEO M. Murali, the real estate market in Bangalore has been growing at a faster rate than in other metros in south India, thanks to the increasing demand for commercial as well as housing space from new economy sectors such as ICT, pharma and auto sectors.

"In the last three years, about 20 million sq feet of office space has been added in and around Bangalore to meet the surging demand. Another 30 million sq feet of office space is expected to be created in two-three years to serve global firms that will be making beeline to India's Silicon Valley for setting up their operations," Murali said.

With the return of George W. Bush in the White House, the reviving US economy is expected to drive growth in India and China, especially in the services and manufacturing sectors.

As part of the 40-billion Shriram Group, with business interests in financial services, insurance, property development and logistics, Shriram Properties has embarked on commercial and housing projects in south India for catering to the high and middle income groups and small and medium enterprises.

The Chennai-based property firm is developing projects worth 8 billion in Bangalore, Chennai and other cities in south India. It posted a turnover of 6 billion in the last fiscal (2003-04).

Source: IANS
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