KARACHI: Brushing aside the economic woes and anticipated storm of inflation in Pakistan, the real estate giants have announced that they will push ahead with three mega projects in the luxury residential, business hotel, offices and retail areas as a consortium of banks released the first financing tranche of Rs5.625 billion.
TPL Properties announced on Monday that its REIT (Real Estate Investment Trust) management company had received Rs5.625 billion (50% of total fresh funds raised) from a consortium of eight banks.
The fund would be used to finance the luxury residential project called One Hoshang; business hotel and offices project named Technology Park; and residential, offices and retail space project called Mangrove.
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“Out of the total initial fund amounting to Rs18.35 billion, TPLP, the strategic investor in the fund, contributes Rs7.1 billion of land value to the fund, in the form of investment property (initial asset portfolio), while the remaining Rs11.25 billion is fresh equity raised by the largest banks in Pakistan (anchor investors). Of which, TPL REIT has received disbursement of Rs5.625 billion (50% of the total fresh funds raised) as part of the first tranche, as the fund met all its condition precedents for disbursement,” TPL Properties Company Secretary Danish Qazi said in a notification to the Pakistan Stock Exchange (PSX) on Monday.
“The remaining 50% of the fresh equity raised will be disbursed in two further tranches based upon specific milestones agreed with the anchor investors.”
One Hoshang project is being developed on Hoshang Road near Frere Hall and Karachi Marriott Hotel. The project is an ultra-high-end luxury residential tower of ground plus 37 stories, a local media outlet reported recently quoting Qazi.
On the development side, One Hoshang saw progress with preparatory and façade protection works nearing completion.
The Technology Park is expected to get SBCA approval in the coming quarter, allowing for ground breaking by the year-end. The company is pursuing for the licence from the Special Technology Zone for this project, the company said in its latest quarterly financials reported for the period ended March 31, 2022.
Development work on The Mangrove (located in Korangi Creek Cantonment area) is progressing well as its master planning and initial regulatory processes are underway, the report added.
It maintained Pakistan’s strong post Covid-19 economic recovery has been negatively impacted by both domestic political instability and rising global inflation due to geo-political tensions. Inflation has been significant in Pakistan. “Despite adverse economic conditions in Pakistan, the real estate sector has continued its robust growth momentum from FY21, on the back of favourable government policies and markup subsidies under Mera Pakistan Mera Ghar (MPMG) and Naya Pakistan Housing Scheme,” it said in its Marchend report.
“Outside the TPL Group, Arif Habib Limited Dolmen REIT has announced four additional REIT funds,” it added.
TPL Properties has incurred a net loss of Rs108.30 million in nine-month period ended March 311, 2022, compared to a net loss of Rs32.16 million in the same period of the last year. Its share price increased 3.65% (or Rs0.73) to Rs20.71 with 11.51 million shares at PSX on Monday.
