India’s leading real estate developer, a major U.S. builder and a London-based hedge fund have formed a joint venture to build integrated residential commercial projects worth $25 billion over the next 20 years throughout the emerging nation.
The venture's key partners are India's Sahara Prime City Ltd., investment firm Acropolis Capital Group and Turner International, the international subsidiary of Turner Construction Co., New York City. With an initial investment of $100 million, the Mumbai-based company will operate under the name Sahara Turner Construction Ltd. Sahara Group holds a 63% stake.
In its first five-year program, the venture says it will build new integrated townships and other projects worth about $2.5 billion.
Sahara Prime City has around 8,485 acres of land reserves available for development. Its business plan has focused on developing 88 integrated townships, between 80 and 300 acres each, under the "Sahara City Homes" brand name and 15 residential complexes under the "Sahara Grace" brand name; the plan includes 99 cities in India. Nine of its integrated townships and one residential complex are now under construction.
Related to problems of land acquisition in India, Turner International President and CEO Nicholas Billotti says Sahara's large land bank would be an important asset for the JV. Sahara Chairman Subrata Roy says the new company aims to be "a multiproduct and integrated construction services company [that] covers the life cycle of building infrastructure and real estate projects."
Delano Furtado, a partner in the India-based law firm Trilegal, which helped structure the new company, told a local publication that demand is huge in India for high-quality, affordable real estate infrastructure built to international standards but that construction best practices are lacking in its real estate sector.