American Real Estate tycoon A Alfred Taubman, who made billions setting up shopping malls across the US, is now eyeing Indian shores.

With organised Retail Market hotting up in the country, NYSE-listed Taubman Centers Inc has initiated talks with private equity funds, including the Reliance Industries-backed Urban Infrastructure Opportunities Fund (UIOF), and Real Estate Developers.

Sources said a Taubman team working in India is exploring opportunities for developing as well as managing Commercial Space in India. The talks centre around forging either a pan-India joint venture with a big fund such as the Anand Jain managed UIOF, or forging multiple regional alliances with prominent developers across leading cities.

It is believed Taubman has been in talks with UIOF for 3-4 months now even though the progress of these parleys could not be ascertained at this point. An email query to UIOF did not elicit a response. In context, it must be mentioned that Taubman Asia was set up recently, with Hong Kong as its headquarters, for expanding in the Asian markets.

Two prominent south-based developers — Prestige Group, which is credited with building arguably one of the most successful Mall Space in India, and Shriram Properties, part of a diversified Chennai-based group — have held early parleys with Taubman. Shriram Properties declined to comment.

Prestige Group V-P (mall development) Neeraj Duggal said: “We have had initial talks with Taubman, but it is too early to comment. They will think of doing much more in India than just bringing in the money.”

Taubman is credited with running some of the popular malls in the US. In 2006, the average annual sales per sq ft in its malls was pegged at $539, making it possibly the most successful firms with respect to turning footprints into revenue. Taubman properties reported an occupancy rate of over 91% during 2006.

After being proclaimed as one of the Seven Wonders of the world, Taj Mahal automatically got the attention from Indian Real Estate Industry. There are many Real Estate Developers from foreign who are interested in the Investment in the area around it.

Also, Property developers and consultants across the country are keenly watching the inclusion of the Taj Mahal as one of the new Seven Wonders of the World. The architectural marvel located in Agra has already been a tourist destination for several hundred years, but its inclusion in the coveted list is expected to further drive tourism--and give real estate and retail in the city a new fillip.

There are already two prominent malls--Taneja and Adlabs—selling handicrafts and ethnic artefacts located near the Taj Mahal. These malls will now get a huge boost. “Developers like Parsavnath, Omax, Ansals and Unitech have started eyeing huge residential and retail developments near the Delhi-Agra highway, spread across several lakh hectares,” says Anuj Puri.

Currently, retail properties in and around Agra are priced at Rs 6,500-9,000 a sq ft. Residential property, on the other hand, is available from Rs 3,500-4,000 a sq ft. Says architect Hafeez Contractor, “The Taj Mahal is all set to boost the real estate market in Agra. Agra should now see a shift in population from Tier-I cities, provided the infrastructure supports it.”

Anil Malhotra from Yum! Restaurants International said, “Agra already has Pizza Hut and KFC restaurants. But now that tourist footfalls in the city are likely to go up, we will be expanding the number of our restaurants significantly.”

A 24-hour TV channel dedicated to real estate goes on air this month in India, a hot property market where buying a new home is considered a hallmark of success among the youthful middle class. About 90 percent of all property investment in the country is in houses, while an economy growing at 8 to 9 percent a year has spurred demand for shopping malls and offices as well.

The owners of "Real Estate TV" say their station will be the first of its kind in south and southeast Asia, a one-stop shop for everything related to the property business and some 250 related industries, such as cement and steel. "It will provide comprehensive, latest and authentic updates on all aspects of real estate, including infrastructure," said Manoj Namburu, chairman of the Alliance Group which owns it.

"Apart from property information, analysis and advice, we will have various shows on lifestyle, heritage homes and interior decor among other things," said Krishnan Sriram, the channel's corporate communications chief. The channel can also be seen in the Middle East, targeting the large Indian expatriate community in the Gulf.

Real Estate TV will also air game shows and even soap operas with a real estate theme, as well as a reality show on the red tape and corruption that faces home-buyers. India's property boom gathered pace after the government eased rules on foreign investment in the construction industry in 2005 to help revamp the country's crumbling infrastructure and fill an estimated shortfall of 20 million homes.

Investors, especially from the United States, have flocked to India since, drawn by a demand for homes among a burgeoning middle class, whose income is growing at 12 percent a year. Still, rising mortgage rates and a doubling of property prices in major cities in the last two years have sharply raised home prices, sparking fears of a downturn. But Real Estate TV is confident of finding a profitable niche on Indian airwaves -- already congested with a glut of news, entertainment, sports and spirituality channels -- because the construction industry is a top advertisement spender.

The high appreciation rates that India's property market is currently witnessing, is due to the Home Loan Interest Rates reduction that the National Democratic Alliance government instituted after 2001. In early 2004, home loan rates sank to a record low of 7.5 per cent and this paved the way for the alarming spiking that typified the country's property rates in many Indian cities.

The very amenable borrowing rates encouraged individuals to avail of home loans to buy residences, while up to then actual property purchase had only been an option for the considerably rich.This resulted in a huge demand for quality real estate all over the country post 2003. Since March 2005, Indian real estate rates have displayed an unstoppable upward curve. This is directly related to the opening up of foreign direct investment in real estate. The market has been expanding at an unbelievable rate of 100 per cent plus. This can also be traced to the heightened NRI interest in real estate.

Many presently feel that the Indian real estate market is a bubble, and will eventually burst. It is true that residential rates in many Indian cities like Mumbai and Delhi are comparable with property rates in the West now. However, let us take an investor's point of view of this phenomenon. Behavioral finance has repeatedly proved that whenever asset prices start escalating, the initial interpretation has been of a 'bubble'. In-depth analysis of price appreciation in real estate and the reasons thereof would help in comprehending these fears. Price appreciation in real estate is backed by the following fundamentals:

Rising income levels, resulting in increased demand for quality constructions and aspirations for better locations in residences. IT / ITeS continues to be a major revenue driver and rising outsourcing trends have driven demand for office space. Hospitality industry is operating on more than 85 per cent occupancy in major metros and rising business activity is resulting in increased investment in hospitality.

Leading real estate consultancies Jones Lang LaSalle (JLL) and Trammell Crow Meghraj (TCM) announced their merger on Tuesday to form the largest real estate services firm in the country under the name, Jones Lang LaSalle Meghraj. While the market share of the new entity will be 35% (taking into account all property consultants), it would be 50% of the international property consultants sector.

The total real estate under management under JLL Meghraj will be a colossal 44 million sq ft, combining 21 million sq ft of JLL and 23.2 million sq ft of TCM. The combined leasing transactions will now be 22 million sq ft, the project and development services would be more than 21 million sq ft.

“The new entity will offer new services also, like a hotel division, new capital markets as well as asset and shopping center management,” says Anuj Puri, country head, JLL Meghraj. The merger takes place after Meghraj Properties bought back the equity of Trammell Crow and then after contemplating the offers, chose JLL as its partner. Trammell Crow was taken over globally in 2006 by CB Richard Ellis.

“With TCM being a dominant player in the domestic market and JLL having international expertise, the new merged entity will definitely be a force to reckon with in the real estate sector,” says Puri.