This first-of-its-kind initiative will increase corporate governance standards and ensure greater transparency in real estate transactions
Bangalore,
September 17, 2009
Bangalore-based real estate developer, Lalith Gangadhar Constructions Pvt. Ltd (LGCL), (investee company of Kotak Realty Fund), today announced that it has initiated a unique concept of maintaining an exclusive Construction Escrow account with a bank for its LGCL-Ashlar project in Bangalore. This concept, which is widely followed in countries such as USA, United Kingdom, Australia etc, is a first in the Indian real estate sector.
Accordingly, LGCL will keep the budgeted Construction Cost for the project in a separate Construction Escrow Account from the payments received from home buyers. The funds in the construction escrow account will be used solely for the purposes of the construction of the Project only.
Mr. Girish Puravankara, Managing Director of LGCL Developers said “This is a major initiative from us to give utmost comfort to our buyers. We realized that home buyers need an assurance that their investment is in safe hands. The Escrow account provides added safety as well as increases transparency for our customers in a market where lot of real estate projects are stuck because of the diversion of sales proceeds received from the customers for non-construction purposes.”
Speaking on the occasion, Mr. Vikas Chimakurthy, Director, Kotak Realty Funds Group said, “We at Kotak Realty are proud of this initiative by LGCL. This move greatly enhances the corporate governance standards in the Indian real estate industry. With this, home buyers will get lot of comfort.”
Lalith Gangadhar Constructions Pvt Ltd. (LGCL) is promoted by Mr. Girish Puravankara with investment from Kotak Realty Funds Group.
The company’s maiden project “LGCL-Ashlar” was launched in November 2008 and comprises of 63 Villas to be built on 7.75 acres of land. Apart from ‘LGCL-Ashlar’, the company is gearing up to launch two other luxury projects in a few months in Bangalore.
To bring transparency in the realty sector, the Associated Chambers of Commerce and Industry of India (ASSOHAM) has brought out a White Paper to make it mandatory for real estate developers to open up an Escrow account to ensure transparency in real estate transactions. The ASSOCHAM Paper maintains it is a very common practice to hold such accounts for any real estate transactions in the developed countries like USA, UK, Dubai and Australia.
About Kotak Realty Fund
Kotak Realty Funds Group (KRFG) is a division of Kotak Investment Advisors Ltd (KIAL) that focuses on Real Estate Investment opportunities. Established in May 2005, it is one of India's first private equity funds, with a focus on real estate and real estate intensive businesses. Our realty investment funds actively consider investment opportunities with the local developers and projects in the residential, commercial and other real estate sectors.
Kotak Investment Advisors Ltd ("KIAL"), a subsidiary of Kotak Mahindra Bank, was set up to focus on managing the Alternate Assets business of the Kotak Group. As part of KIAL, KRFG currently manages 2 funds that are domiciled in India and advises one Offshore Fund.
About Lalith Gangadhar Constructions Pvt. Ltd (LGCL)
Lalith Gangadhar Constructions Pvt. Ltd (LGCL) is a Bangalore-based startup venture promoted by Kotak Realty fund. The company’s maiden project “LGCL-Ashlar” was launched in November 2008 and comprises of 63 Villas to be built on 7.75 acres of land. Apart from ‘LGCL-Ashlar’, the company is gearing up to launch two other luxury projects in a few months in Bangalore.
For further information, please contact:
|
