The Secrets of Green Real Estate Investing

Presented by: Yogendra Kumar

Investment in Real Estate sector in India

Investment Scenario - India

2 ways of investment in Real Estate & Housing sector
Direct Route RBI Approval Route or Alternate Route

Direct Route of Investment in Real Estate & Housing Sector - 1

What does this mean :
No approvals required Indian company can well receive funds from their foreign partner through proper banking channels

Who is allowed :
Only NRIs (Non resident Indians) are allowed to invest upto 100% in the real estate & housing project Pls refer pg 6 of presentation for alternate means of investment and fully legal

Direct Route of Investment in Real Estate & Housing Sector - 2

What is the definition of Real Estate & Housing Project under legal parlance :
Investment in real estate covering construction of residential and commercial premises incl business centres and offices Development of townships City & regional level urban infrastructure facilities, incl both roads & bridges Invetsment in Housing Finance Institutions which is also opened to FDI (Foreign Direct Investment) & NBFC (Non Banking Finance Co)

Direct Route of Investment in Real Estate & Housing Sector - 3

What is the definition of Real Estate & Housing Project under legal parlance :
Development of serviced plots and construction of built up residential premises Investment in real estate covering construction of residential and commercial premises incl business centres and offices Development of townships City & regional level urban infrastructure facilities, incl both roads & bridges Investment in manufacture of building materials Investment in participatory Ventures in a & c above Investment in Housing Finance Institutions which is also opened to FDI (Foreign Direct Investment) & NBFC (Non Banking Finance Co)

Alternate Route of Investment in Real Estate & Housing Sector-1

To have humble beginning in the real estate & housing sector; we propose the following proposal
A Foreign investor can become a shareholder in an Indian co specifically formed for working in real estate sector Equity of foreign investor may be from 51% to 74% For becoming equity partner, single window clearance from RBI is reqd wherein detailed project shall have to be submitted with basic details (normal time consumed for approval is max 2 months) No min cap on the investment from foreign investor (it shall be Project specific) Funds transfer for purchasing equity through banking channels Remittance to Foreign director under regular dividend remittance route through RBI approval

Alternate Route of Investment in Real Estate & Housing Sector-2

Benefits of our proposal :
No min cap on investment : Even USD 1 mil can be invested To experience Indian Real estate market Proper documentation of funds transferred through banking channels & complete accounting/accountability Various smaller size project opportunities may be tapped like conversion of underdeveloped/developed industrial plots in NCR (national capital region) into offices for IT/ITES or big export houses

Alternate Route of Investment in Real Estate & Housing Sector-3

Fall outs of our proposal :
RBI approval for inward & outward remittances Project can be started only once funds are received Real Estate business is high return & high risk and prone to various economic factors

Our plans to overcome fall outs :

Lawyer & Chartered accountant to be hired specifically for the RBI approval & documentation RBI approval to be applied well in advance with basic project reports & even the prior investment may done by Indian co. after scenario analysis Investment in Housing sector may be avoided upto Oct,07 as little slowdown whereas industrial & commercial sector may be tapped for regular better returns

Conclusion
NRI permitted to freely invest in real estate RBI approval reqd for smaller investments by foreign investors but in normal conditions it may be through Inward & outward remittance of funds may be through proper banking channels Indian real-estate sector is all set to grow drastically in next 10-15 years & you may partner us in benefitting alongwith the growth
This is Food for thought.