Godrej Properties Surprises Market with Land Sale in Gurugram

Unexpected land sale by Godrej Properties in Gurugram shifts real estate dynamics as Hero Realty eyes major opportunities.

Godrej Properties, a big name in the Indian real estate sector, is currently in talks with Hero Realty to sell a 14-acre land parcel in Gurugram valued at approximately Rs. 730 crore. This was unexpected, as they purchased the land in Sector 89 two years ago from a local land-aggregating company.

The land in Gurugram was supposed to be the site for one of Godrej Properties' largest residential developments. The asking price on the Floor Space Index (FSI) for 2.1 million square feet is Rs. 3360, with a Floor Area Ratio (FAR) of 3.5 available for development on the land, according to insiders.

The Haryana government town and country planning department granted Godrej Properties a licence agreement in July 2023 to develop a mixed-use project in Sector-89 Gurugram Manesar urban complex. This development was set to include a 5% commercial component.

On the other hand, Hero Realty, backed by Sunil Kant Munjal's Hero Enterprise, has been actively expanding its presence in Gurugram. They recently acquired a 5-acre plot of land for Rs. 90 crore to develop a residential project. This year, with plans to launch real estate projects covering approximately 4 million square feet, projecting an estimated revenue potential of Rs. 3,500 crore.

This unexpected sale by Godrej Properties is a surprise, given their track record of actively buying land in major locations to meet the strong housing demand. Last year only, the company bought 18 new land with a sales potential of Rs. 32,000 crore post-development. They also made notable land acquisitions in Noida and Mumbai, underlining their commitment to expanding their portfolio.

Notable acquisitions by Godrej Properties included two adjacent lands, measuring 12.4 acres in Noida and 9 acres in Gurugram, both aimed as residential projects. In Mumbai, they secured an 18-acre land parcel for Rs. 750 crore to develop a luxury housing project.

Despite this unexpected land sale, Godrej Properties remains a strong player in the market. In the last year, the company achieved a 56% increase in sale bookings, reaching an all-time high of Rs. 12,232 crore, with a booking target of Rs. 14,000 crore for the upcoming year.