Parsvnath bets on leases

Parsvnath Developers Ltd, the New Delhi-based real estate developer, is looking at generating Rs 300 crore as lease income from its commercial business over the next three years.

The developer, which currently generates minuscule revenue from its leasing business, would start its Delhi Metro Rail Corporation projects in Azadpur, Akshardham and Seelampur in Delhi which include malls and commercial spaces etc.

The new projects will generate Rs 150-200 crore in lease revenues. Overall, Parsvnath would deliver 2.2 million square feet of commercial space over the next three years which will generate rentals of Rs 300 crore.

For the nine months ended December 31, 2008, the developer generated Rs 30 crore of rental income from its four projects at Kashmere Gate, Inderlok, Tis Hazari
and Pratap Nagar. A Parsvnath spokesperson declined to comment as the company is in silent mode before its results which would be announced on June 20.

The company recently announced plans to raise about Rs 2,500 crore through issuing securities and by qualified institutional placement of shares to retire its outstanding debt and invest in hospitality and special economic zone projects.

The developer would cut its debt from the Rs 1,600 crore to Rs 600-700 crore by end of this fiscal. To increase its cash flow, Parsvnath would also sell stakes in its special economic zones and hotels to private equity investors.