Realty going the wrong way for long term

 In the city’s largest land transaction of 2009, the Mumbai-based Wadhwa Group is believed to have recently concluded negotiations to buy the 18-acre Hindustan Composites land in Ghatkopar for Rs 570 crore. Given the current circumstances, when the property market is just about finding its feet following a slump, the price is considered to be substantial. 
    The prime land is located on LBS Marg in Ghatkopar and has seen a slew of prospective buyers over the past several years. In 2008, the Suresh Raheja-led K Raheja Universal was believed to have virtually bought this land for over Rs 700 crore. However, when the property market tanked, the deal did not go through. 
    The plot is one of the last such sprawling defunct factory properties in the eastern suburbs; most of them have been sold since 2005. Vijay Wadhwa of the Wadhwa Group refused to comment but market insiders confirmed that the developer and the factory management would announce the transaction in the next two weeks. Wadhwa is expected to raise about Rs 400 crore from financial institutions for the land acquisition. 
REALTY RISES IN THE EAST 
The 18-acre prime property is located on LBS Marg in Ghatkopar. It is one of the last remaining mill lands in the eastern suburbs and has a development potential of 15 lakh square feet 
Many developers wanted to buy the land since it went on the block in 2006 
Developer likely to construct at least 15 residential buildings with over 1,100 apartments 
OTHER BIG-TICKET BUYS RIL bought 18 acres in BKC for Rs 1,104 crore in 2006 
Wadhwa Group bought less than 2 acres in BKC for Rs 831 crore in 2007 
Sajjan Jindal group acquired 2.5 acres of Orbit Corporation’s property in Kalina for Rs 807 crore in 2007 
DLF bought NTC’s 17-acre Mumbai Textiles mill for Rs 702 crore in 2005LBS plot has huge potential for devpt 
Mumbai: Property market experts said the Wadhwa Group had chalked out a plan to set up at least 15 residential buildings with over 1,100 apartments on the sprawling 18-acre land in Ghatkopar. The property has a development potential of about 15 lakh square feet. This potential could shoot up substantially if Wadhwa takes advantage of the government’s parking FSI of 4. 
    Many in the industry felt that the Wadhwa Group, known to be one of the more aggressive real estate groups, had overstretched itself when it quoted an astronomical Rs 831 crore for a less-than-two-acre plot in the Bandra-Kurla Complex (BKC) in November 2007. It was a national record for the purchase of commercial land. His bid worked out to Rs 5.04 lakh for every square metre or almost two and a half times the reserve price of Rs 1.53 lakh set up by the Mumbai Metropolitan Region Development Authority(MMRDA). 
    Soon after, the property market stagnated and there was a feeling that Wadhwa had burnt his fingers by paying such a huge price for this plot. But MMRDA came to the rescue when it increased the FSI in BKC, thus increasing the development potential on Wadhwa’s plot. 
    LBS Marg in the eastern suburbs from Ghatkopar to Mulund was once known as an industrial belt. Today, it has become a hotbed for real estate activity, with many closed factories being converted into residential and commercial zones. Some of these are the Glaxo-owned Burroughs Wellcome, Bombay Oxygen and Schrader Duncan plots in Mulund, GKW and API Industries’ land in Bhandup and the Mukand Ltd plot in Kurla. 
    The Hindustan Composites land transaction comes barely months after the Lodha Group offered to pay Rs 710 crore for the National Textiles Corporation’s (NTC) 10.4-acre Finlay Mills plot in Parel. However, NTC rejected the offer without offering sufficient reasons, and Lodha had to approach the Supreme Court to prevent NTC from selling the land to a third party.