Al Ghurair group''s ETA Star is offering rich Indians
real estate propositions in Dubai and in India in collaboration
with the Tata group''s Taj chain. Among these are the
Grandeur Residences at Palm Jumeirah in Dubai and The
Gardens in Bangalore.
realty developers are wooing wealthy Indians, especially
celebrities, jetsetters, and the growing tribe of billionaires,
wanting them to invest a part of their growing assets
portfolio in overseas properties.
India taking tentative steps towards the free float
of the rupee, international developers see tremendous
opportunities in the country, and have begun marketing
projects. The latest to do so is Dubai-based ETA Star,
part of the $3 billion Al Ghurair group, which has a
significant presence in property development and retailing.
Abid A. Junaid, executive director, ETA Star: "We
expect many resident Indians to invest in our new project
in Dubai. The response so far has been overwhelming."
Reserve Bank of India (RBI), the country''s central bank,
allows resident Indians to remit up to $25,000 every
year for a range of ''permissible capital or current
account transactions or a combination of both'' (including
acquisition of immoveable properties abroad).
buoyant foreign exchange reserves position - with total
reserves touching the $150 billion-mark - have emboldened
the government to think in terms of considering full
convertibility of the rupee on the capital account.
Minister Manmohan Singh recently suggested that the
time was ripe to ''revisit'' the issue of full convertibility
of the currency on the capital account, and the Reserve
Bank of India (RBI), has already set in motion the process,
by appointing former deputy governor of the central
bank, S.S. Tarapore, to once again take a call on the
issue of free float of the rupee.
earlier recommendations in 1997 laying the roadmap
for full convertibility of the rupee three years down
the road - had to be abandoned after the Asian financial
meltdown later that year. But the United Progressive
Alliance (UPA) government appears set to pursue this
course, and take it to it logical end: convertibility
of the rupee on the capital account.
rupee is now virtually fully convertible on the capital
account for NRIs, but resident Indians still face restrictions
on repatriating funds abroad. The RBI had about two
years ago introduced the Liberalised Remittance Scheme,
enabling resident individuals to freely remit up to
$25,000 per calendar year for any permissible current
or capital account transactions, or a combination of
individual can acquire and hold immoveable property
or shares or any other asset outside India without the
prior approval of the RBI.
course, $25,000 will not go a long way while investing
in a property in Zurich or New York. But careful planning
would enable an affluent Indian family of four to comfortably
acquire a plush apartment in Dubai, like the ones being
developed by ETA Star, which is promoting the $330 million
Taj Exotica Resort & Spa and the Grandeur Residences
project at the Palm Jumeirah Crescent in Dubai.
company has entered into a management contract with
Taj Exotica, part of the Tata-controlled Indian Hotels
Company Ltd. While the property is being developed (and
owned) by ETA Star, Taj will manage the resort, the
spa, and also the 200 fully-furnished apartments and
one of the most dynamic states in the United Arab Emirates
(and also in the Middle East) is witnessing a veritable
property boom, with projects worth a whopping $100 billion
being executed both by the public and private sectors.
Palm is a landmark project - envisaging the creation
of the world''s three largest manmade islands, the Palm
Jumeirah, the Palm Jebel Ali and the Palm Deira - and
one of the biggest property development projects in
the world today. Nakheel, a leading property development
firm in Dubai, which alone is developing $12 billion
worth of projects in the emirate, is promoting the Palm
three, palm-tree shaped islands are expected to increase
Dubai''s shoreline by over 500 km, and provide luxurious
homes to over half a million people. With its limited
population, the Dubai government had to go in for radical
changes in the land laws, allowing expatriates and foreigners
to acquire properties in the emirate. India, with its
growing number of dollar millionaires is one of the
key markets for Dubai developers hawking properties
in the emirate.
to Junaid, the project is expected to be operational
by 2009. With many Indian businessmen travelling frequently
to Dubai - and paying between $300 and $500 a day for
hotel rooms - they would find it an attractive proposition
to acquire an apartment or a villa at the new development.
Grandeur Residences comprise one, two and three-bedroom
apartments, besides four-bedroom villas, and are being
sold at between $520,000 to $3.5 million. The residential
units offer stunning views of the sea and feature an
array of amenities including a spa, health clubs, restaurants
and 24-hour security.
the amenities that are being offered the price tag appears
affordable for many Indian businessmen. Recently, a
chartered accountant paid an unbelievable Rs.40,000
for a sq ft of built-up space in Mumbai''s tony Cuffe
Parade, acquiring a 3,000 sq ft apartment in an existing
building for about Rs.12 crore (about $2.65 million).
similar sized apartment - but with international standard
amenities, and minus the neighbourhood slums, dug-up
roads, and atrocious civic amenities - can be had in
Dubai at about half the price. So real estate analysts
expect a good response from affluent Indians to the
offer from Dubai''s ETA Star.
leading property development group, the Hiranandanis,
has already teamed up with ETA Star and is putting up
a 90-storied edifice, the ''23 Marina,'' in the Dubai
foresee Dubai being the Monte Carlo of the world in
a few years and our development has been designed to
cater to that kind of clientele," said Darshan
Hiranandani, director, Hircon LLC, the group subsidiary.
"We believe that representing India in Dubai at
this juncture is the beginning of an experiment to build
better communities beyond India''s borders."
the Dubai firm is also investing large amounts in developing
projects in India. According to P.H.M. Syed Ismail,
director, ETA Star, it has set up ''land banks'' in Bangalore
and Chennai, acquiring hundreds of acres of land in
recent months. The group has invested $100 million in
India so far, and hopes to invest another $200 million
over the next few years.
plan putting up IT parks, residential townships and
other facilities in these two cities," he explains.
"We have properties along the IT corridors in Bangalore
and Chennai. We are also taking up a residential project
in Juhu in Mumbai, and will be taking up projects in
Delhi, Kolkata and Pune."
Dubai-based property developers who have taken up major
property projects in India include Emaar Properties,
which is developing the sprawling Hyderabad International
Convention Centre, a business-cum-leisure facility,
and has announced the largest foreign direct investment
(FDI) of $500 million in the Indian real estate sector.
has joined hands with Delhi-based MGF Developments,
and plans to take up $5 billion worth of projects in
Haryana, Punjab, Maharashtra, and the four southern
Indian states over the next few years.
the Taj group, the tie-up with ETA Star provides an
excellent opportunity to expand its overseas drive.
According to Raymond N. Bickson, managing director and
chief executive officer, Indian Hotels Company Ltd,
"the launch of this project is in keeping with
the group''s strategy to expand into the key gateway
cities of the world."
group has a strategic presence in luxury residences
through Taj Wellington Mews in Mumbai and 51 Buckingham
Gate in London, besides residential complexes in other