Taking into account the future property prospects of real estate sector in Indian capital, Dubai-based Sherwoods Independent Property Consultants has set sights on New Delhi property sector and will open an office over there shortly.

Property adviser in Dubai, with a strong presence in the UAE as well as Europe, foresaw New Delhi's buoyant housing market with rising demand among the burgeoning middle class as India's economy booms.

Sherwoods estimated that there is a supply It also aims to beef up its presence across other major Indian cities. As well as showing signs of recovery from the global crisis, interest rates in India have from fallen from 11.5 per cent to 9.25 per cent, making mortgages cheaper.

Indiabulls Real Estate Ltd. said Wednesday it has raised around 26.56 billion rupees ($557 million) via a share sale to institutions, joining a growing list of Indian realty companies that are raising funds to reduce debt and boost liquidity.

Indiabulls, one of the country's biggest property developers, issued about 143.59 million shares to institutions at 185 rupees each, the company said in a filing to the Bombay Stock Exchange.
Indiabulls, part of the diversified Indiabulls Group, didn't identify the investors and company executives didn't immediately respond to queries.

A person familiar with the matter said Tuesday the shares were sold to 49 institutional investors from India and overseas. Morgan Stanley was the sole bookrunner for the deal, the person said.
Higher borrowing costs and fears of job losses in a slowing economy have hit property sales in India, affecting cash flows of the realty companies. This has led several developers to raise capital via share issues, asset sales and also replacing their costlier debt with cheaper loans.
The companies are also introducing mid-priced residential projects and offering customized loan packages to lure customers.

"Most real estate companies across the region (India) had improvements in access to capital from January/February this year," Unmesh Sharma and Gautam Duggad, Mumbai-based analysts at Macquarie Research, said in a recent note. "Only now do Indian property developers appear to be experiencing better capital conditions."

Macquarie rates India's property sector overweight, citing improving liquidity for the property developers.
Founders of DLF Ltd., the country's biggest property developer by market value, raised 38.60 billion rupees on May 13 by selling a 9.9% stake to investors that included HSBC Holdings Inc. and Fidelity.

Unitech Ltd., the second-ranked realty company by market value, is also gearing up to raise additional long-term funds via a warrant issue to its founders as well as an issue of securities.
The company had raised 16.21 billion rupees in April by selling shares to institutional investors including HSBC Holdings PLC, Prudential PLC and Singapore's Orient Global.

Unitech plans to repay up to 17 billion rupeesc of debt in the current financial year that began April 1 through cash flows from sale of apartments and shopping malls, a senior company executive, who asked not to be named, said last week. Its debt is currently at about 80 billion rupees.

Shares of Indiabulls traded 5.1% higher at 210 rupees as of 0724 GMT on the Bombay Stock Exchange, compared with the benchmark index which was down 1.4%.
Shares of Indiabulls have gained 52% since January, outperforming a 46% rise in the BSE's realty index.

With the UPA returning to power, the property pundits anticipate the revival of real estate market in the northern region that has witnessed shrinking of transactions when the country was in election mode. “The sale and purchase of property will now start taking place as the Center is expected to have stable government led by the UPA,” Punjab Properties and Colonizers Association Chairman Anil Chopra told PTI.

The property transactions dipped by 70 to 80 per cent in the northern region ahead of the elections as people were not inclined to invest in the real estate due to apprehensions that no major political party would get majority in the elections to form the government, experts said. “We observed just ahead of the start of the elections that the sale and purchase of land or residential or commercial properties almost came to halt with investors as well as end users preferring to wait till the new government is formed,” Chopra said.

He said that with the demand expecting to start emerging after the elections, the property rates would again move upward which would bring some relief for the realty sector. “We are seeing enquiries for residential as well as commercial properties by customers particularly in Gurgaon and Delhi after the elections which is a good sign for the real estate industry,” Realtech Group CEO Rohit Malhotra said.