Hotel Leelaventure is looking to cash in on the growing real estate market in Chennai, as it plans to partly sell and lease its Leela IT Park in Chennai.
The property spread across 2.75-lakh square feet located in Adyar, is expected to fetch Rs 275-300 crore for the company. This information was given by Vivek Nair, Vice-Chairman and Managing Director, Hotel Leelaventure Ltd. The deal for partial sale of the property will be finalised in a month, he said.
"Chennai's real estate market has picked up and the rates are up 20-30 per cent, with the growing interest from multinational corporations and others for commercial space. Also, there are few graded buildings like ours with large floor space, green area and other state-of art commercial amenities," said Nair elaborating on the reasons to put the property for external commercial use. The idea is to develop the area on the lines of Leela Business Park in Mumbai, Nair added.
According to a report in The Hindu Business Line, the proceeds from the IT Park will be utilised to repay some debt of the company. The company has decided not to have a hotel in Pune and instead develop the land for a residential complex, he said. The earnings from that initiative, which could be to the tune of Rs 250 crore, will also be used to clear debt.
These moves would enable the company reduce its debt of Rs 2,600 crore by Rs 550-600 crore. "The promoter holding in Leelaventure is 55 per cent at present, which we intend to take beyond 60 per cent through creeping acquisition. Our promoters have enough cash flows (for the acquisition)," said Nair.
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