Middle Level Developers Having A Good Time Buying Distressed Projects

The recent economic downturn and global recession led to many builders abandoning their projects midway. They were in a situation where they could simply not proceed. Such unfinished projects or land lying unused are up for grabs and middle level builders are having a good time buying such distressed projects at lower valuations. The small builders are the hardest hit and the recent hike by RBI does nothing to give them hope.

It is likely that small builders will sell off more such unfinished buildings and land. Banks have tightened the screws still further with stricter terms. Such builders simply do not have the money to complete their projects and have no buyers for their commercial spaces or residential complexes.

For cash heavy middle level builders this comes as a windfall as they have access to a number of prime properties at discounts of 25 to 30% of the current market values. ]

Patel Realty India Ltd, the Salarpuria Sattva Group and Ajmera Realty and Infrastructure Ltd are said to be very active in acquiring such properties. They are advantageously placed since the properties have clear titles, enabling them to get off to a running start. Such deals are in active progress in Mumbai, Bengaluru and even in smaller cities like Pune and Ahmedabad.