Tuesday, March 4, 2008

Asipac to Create Investment Banking and Procurement Services SBUs for Real Estate Sector

India's No.1 real estate development services and project marketing company asipac today announced it is creating new Strategic Business Units to offer Investment Banking & Asset Management Services as well as Procurement Services for the real estate sector.
"In 18 months, we have helped developers raise Rs.6290 million in equity funding without a dedicated team," said asipac Chairman Amit Bagaria, "Now, we are creating a Strategic Business Unit with a President and a team of 4 to begin with." The company already has mandates in hand to raise Rs.5611 million of equity. "The new business unit will begin with these deals and have a target of Rs.16 billion in 3 years," commented Bagaria.
According to asipac's Chief People Officer James Arun, "we have already recruited a President and a VP for this unit, one with 22 years experience in fund-raising and investments in USA, Europe, South Africa, Hong Kong and India, and the other with 16 years financial planning and investment advisory experience in USA, including 6 years in real estate financing. The head of procurement has joined us with 10 years global experience in sourcing."

"Sachin Parker, MBA from University of Texas, joins us from Newland, a US Based Real Estate Developer and Investment Advisor. Sachin has extensive experience in real estate investment analysis and fund management. His relationships with global financial institutions will add a lot of value to the business," added James.

"Indian RE industry procures Rs.550+ billion worth of raw materials every year and there exists a potential market for semi furnished and fully furnished homes for over Rs.250 billion. asipac has created the Procurement Services Unit to tap this potential but unorganized market size of Rs.800+ billion. Even with 1% market share, asipac can earn a service fee of Rs.200 million per annum," commented Bagaria.

"Vikas Gupta, CFA, joins us from a leading UK based international steel manufacturing group, to head the Procurement Services Unit. Vikas has extensive global sourcing skills and networking capabilities. He has successfully developed and managed big ticket partnerships and JVs globally," said James.

asipac has an order book of contracts in hand for fee income of Rs.3164 million and is projecting revenues of Rs.800 million in FY'09 and over Rs.1700 million in FY'10.

Since 1996, asipac has worked on projects of ~375 million square feet valued at $23bn+. Today it has sole selling rights for projects of 26.3 million square feet, valued over $2.7 billion. Current projects in 14 cities include a 6350-acre indulgence nature resort township, a 600-acre integrated township with golf course, a 200-acre lakeside "second home" community, a 4.4 million sq. feet workforce housing township, 906,000 sq. feet regional super-mall, a 3.4 million sq. feet affordable homes township, an 80-acre continuing care retirement community, a Rs.600-crore super luxury high-rise condominium project, a Rs.505-crore indulgence condominium project, a 51-acre suburban township and a 50-acre gated community of India's most luxurious villas. These have more than 18,900 homes.

"Our business model is vastly different from IPCs such as CBRE, C&W, JLLM or pure marketing brokerages such as Oysters, Orange Properties or NK Realtors", says Bagaria, "instead of implementing beaten track or even innovative marketing ideas for a pre-determined product planned by the developer, asipac works at Phase-Zero, by looking at unmet consumer needs and conceptualizing new products, helping design them and then taking them directly to the consumer. In 15 months, we have launched 4 different types of RE projects and all have been distinctly unique from the market - one even made it to the Guinness Book of World Records. Currently, we are working on 8 more unique products which should hopefully be launched in the next 5-15 months, and the markets will truly see a difference. With the new Investment Advisory Services Group and the centralized procurement division, apart from project strategy, conceptualization, planning, marketing and project sales services, we will also help our developer clients raise funding for their projects and cost savings in procurement, thus widening our scope of services."

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