INDIA BUSINESS WORLD - March 16th - March 31st - 2008
BOMBAY DYEING, LARSEN & TOUBRO JOINT VENTURE TO BID FOR REALTY PROJECTS
The recently-formed joint venture between Bombay Dyeing and Larsen and Toubro will bid for projects earmarked for redevelopment and for other viable property projects in Mumbai and other cities. “We have formed the JV with Bombay Dyeing and are developing a redevelopment project in Bandra through the new entity,” L&T finance director Y M Deosthalee said. Sources said the JV has recently won the redevelopment of around 0.2 million sq ft of MIDC colony in Bandra-Kurla in Mumbai. It has also been learnt that while Bombay Dyeing has itself firmed up large plans in real estate, it plans to utilise the construction expertise of L&T to bid for the redevelopment projects.
Redevelopment of old buildings in Mumbai is a large business opportunity, as the government has introduced new incentives for redevelopment activities, which would allow higher FSI and tax incentives. Mumbai has an estimated 16,000 buildings which would fulfil criteria for redevelopment. Under the scheme, old and dilapitated buildings are knocked down to make way for taller residential buildings that could free up space for commercial complexes to boost returns from the project. L&T as a JV partner would also lessen the financial burden for Bombay Dyeing as redevelopment of large societies involves a construction cost of about Rs 10,000 crore.
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