Deyaar set for $5bn India township deal

Dubai's Deyaar Real Estate said yesterday it expected to clinch a $5 billion deal this year to build a township in India with Ansal Properties & Infrastructure Ltd.

The deal would make Deyaar, which complies with Islamic law, the latest Dubai property developer to expand into India, where rapid economic growth is lifting millions of families out of poverty and into income groups that can afford houses.

"We will announce the deal ... within 30 to 60 days," Chief Operating Officer John D'Cunha told reporters on the sidelines of the MEED capital markets conference in Dubai.

Deyaar and its partners will build homes and offices for sale and lease in the suburbs of the capital New Delhi, Chief Executive Zack Shahin told Reuters.

Shahin first announced the project in September but did not give a timeframe. Other Dubai developers are pushing into India.

Dubai-government owned Limitless is working with Indian developer DLF Ltd to develop a $12 billion housing and commercial real estate project near the technology and outsourcing hub of Bangalore.

Dubai's Emaar Properties, the largest Arab real estate company, has an Indian joint venture with MGF Development Ltd.

Developers such as MGF and DLF, India's biggest by market value, are building more homes for people on lower incomes in India, a country that has about 53 million families earning $2,500 to $5,000 a year.

India's booming economy is projected to lift a further 22 million families out of poverty and into this income bracket by 2010.

Deyaar, which develops, rents and manages properties, said in September it was working on $7 billion worth of projects from Lebanon to Kazakhstan with cash from its initial public offering which raised 3.18 billion dirhams ($866 million) in May.

The company, which complies with Islamic law that bans interest on lending and dealing in alcohol and pork, said in September it could raise more cash through Islamic bonds and loans.

"At the moment, we are not looking at raising any money," D'Cunha said on Monday. He reiterated the company's full-year net profit forecast of 520 million dirhams.