BackDLF sells Saket shopping mall to subsidiary for Rs904 crore
The move is in line with the strategy to consolidate and monetise the rental assets
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Bengaluru: DLF Ltd, the country’s largest real estate firm by market value, has decided to sell its shopping mall in Saket in the national capital to its unit for ₹ 904.50 crore as part of its plan to streamline and monetize its existing assets.
The transaction with Nambi Buildwell Pvt. Ltd, on an arm’s length basis, also includes the sale of the land parcel on which the 5.16 lakh square feet mall is situated, said DLF.
“This is in line with the strategy to structure ownership of existing assets in order to facilitate potential monetization either through REITs or otherwise in future, subject to necessary regulatory and statutory approvals," DLF said in a statement to the BSE on Thursday.
DLF has been gearing up to launch real estate investment trusts (REITs) worth up to ₹ 6,000 crore in two tranches over the next two years.
REITs are listed entities that primarily invest in leased office and retail assets, allowing developers to raise funds by selling completed buildings to investors and listing them on stock exchanges as trust. Investors earn return on investment either through value appreciation or rental income generated from commercial assets.
DLF is currently also in the process to partly sell its commercial office portfolio, which involves DLF promoter companies Rajdhani Investments and Agencies Pvt. Ltd, Buland Consultants and Investments Pvt. Ltd and Sidhant Housing and Development Co. selling a 40% stake in DLF Cyber City Developers Ltd (DCCDL) to institutional investors.
DLF will continue to hold the remaining stake in DCCDL.
DCDDL also has a retail mall platform that includes, besides the Saket mall, DLF Emporio and DLF Promenade in Vasant Kunj, City Centre in Chandigarh and Mall of India in Noida.
“DLF has two large portfolios of commercial office and retail assets. Just the way it is streamlining its office assets, so it can monetize them in the future, it seems to be doing the same through this transaction," said Sandipan Pal, an analyst at Motilal Oswal Securities Ltd.
Finance minister Arun Jaitley in the Union budget proposed to exempt REITs from the purview of dividend distribution tax (DDT), removing a significant hurdle to its formation.
DLF posted a 24.6% increase in net profit to ₹ 163.95 crore in the December quarter from a year ago. Its net debt fell by ₹ 1,100 crore quarter-on-quarter to ₹ 21,396 crore (as of 31 December).
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