NEW DELHI: Real estate developer TARC Limited has raised Rs 1,000 crore from a consortium of domestic banks and financial institutions led by Kotak Mahindra Bank.
The majority of the funds, raised at 12.75% interest, will be used for refinancing of its existing debt along with Rs 250 crore additional working capital facility to be available on call.
The consortium included institutions such as Nomura Capital, Aditya Birla Capital and STCI.
“We are extremely excited about this transaction, as it represents a significant positive advancement for our company,” said Amar Sarin, managing director and CEO of TARC Ltd.
The funds will enhance TARC’s cash flows, facilitating substantial savings. The reduction in interest cost will provide the financial flexibility necessary for growth and expansion, according to the company.
The refinancing is secured only against the cash flows of two of the company’s projects – TARC Kailasa and TARC Tripundra.
“By anchoring the refinancing on expected revenues from these projects, TARC is effectively aligning its financial strategy with its operational performance,” the company said.
The remaining debt is to be secured by cash flows from TARC lshva, it said.
The company is investing Rs 1,200 crore in developing TARC Kailasa, a luxury residential project in western Delhi’s Kirti Nagar.
It will develop 1.7 million sq ft under his project and is expecting Rs 4,000 crore revenue from it.
“Luxury residential real estate has been on the growth path and we believe this will continue,” said Sarin. “Central Delhi has seen very few gated condominiums and this project will fulfil the need of Delhiites who had to move to Noida or Gurgaon.”
TARC Kailasa is spread on a 6-acre land parcel and will have five high-rise towers designed by Andy Fisher Workshop of Singapore.
The company has appointed Arabian Construction Company as its construction contractor, considering their expertise in high-rise constructions and the large number of delivered projects across India and the UAE.
The company had raised Rs 1,330 crore from Bain Capital for the project by way of non-convertible debentures.
