Godrej Properties to raise Rs 1,500 crore by selling office assets to reduce debt

Godrej Properties Limited (GPL) is on the way to cut off its debts by planning to sell some of its office assets to raise almost Rs 1500 crore. According to a research report, Godrej Properties' net debt jumped by Rs 270 crore on a sequential basis to Rs 3270 crore in the October-December quarter. This was mainly due to cash outflows related to land and approval.

In continuing slowdown scenario in terms of sales and delivery, GPL has been proven among country’s best developers. Recently, it has tied up with Taj Group to develop luxury hotel project, whereas many other peer companies have not launched any new projects. Further, it has signed seven new projects in Greater Noida, Bengaluru and Pune in 2016-17, that were a mix of joint development agreements and outright land buys.

As per company's chairman, they are planning to raise capital by selling office projects located at Kolkata and Chandigarh. Company is working on non-capital intensive business model which helped it to grow in slow moving conditions in real estate sector.

As real estate sector is in struggling stage, developers have put a halt on new projects led by no demand from buyers. According to a survey, the unsold inventory dipped slightly by 3.12 per cent in January-March period compared to its previous quarter and home launches dipped by 19.46 per cent.

Godrej Properties Ltd., part of Godrej Group, is engaged in construction and real estate development. It focuses on residential, commercial and township developments. It has around 125 msf (million square feet) of developable area across India.