September
11, 2012
Prozone CSC Ltd
which was a subsidiary of Provogue India Ltd has gone through the demerger
process duly approved by the Mumbai High Court and is scheduled to be listed as
a separate entity on the BSE and NSE on 12th September 2012. As part
of the approved demerger scheme the existing shareholders of Provogue (India)
Ltd received one share of Prozone CSC.
Prior to the demerger Provogue held
75% stake while Capital Shopping Centres Group Plc, UK owned 25% stake.
Following the demerger Provogue promoters will hold 35.08% and Capital Shopping
Centers (CSC) will hold 32.38 % stake in the demerged company Prozone CSC Ltd
and the remaining holding will rest with the public.
Prozone
CSC brings together the shareholders of the Capital Shopping Centres Group Plc,
UK a UK FTSE-100 listed company the largest specialty real estate group in the
UK, and Provogue (India) Ltd. Capital Shopping Centres which is largely focused
on shopping centre development and management, will be closely working with the
Prozone management to develop large scale retail-led mixed-used real estate
projects in India. CSC has appointed two of their most senior Directors to the
Board of Prozone CSC Ltd, namely Mr David Fischel, Chief Executive and Mr John
Abel, Director.
The
company has a land bank of 17.8 million sqft in fast growing markets such as
Aurangabad, Coimbatore, Nagpur, Indore, Jaipur and Mysore with 4 of its
projects in advanced stage of execution. The company has a sound balance sheet
with around 11crore net debt at the consolidated level and has financial
closure on the construction finance required for projects in the pipeline which
are to be implemented from 2012 onwards.
As
a specialist developer, Prozone CSC’s strategy is to focus on developing new
urban hubs, consisting of shopping malls, residential colonies and modern
office blocks that can evolve as India’s new city centres. Theses mixed-use
retail centres are designed and built with a long-term ownership vision of
typically 20 years to deliver sustainable competitive advantage in their
markets.
Prozone
CSC’s experience shows that property adjacent to major retail centres is a draw
for new residential, commercial and hospitality projects as people
traditionally want to live and work within the vicinity of great shopping and
entertainment destinations. The company has acquired additional land banks
around chosen locations in order to leverage this added value. Prozone CSC will
develop residential colonies and commercial office blocks with an aim to sell
these assets to create debt-free retail properties.
The
company already owns and operates one Regional Shopping Center in Aurangabad.
Development of the second Shopping Centre in Coimbatore has started and will be
followed by Nagpur in the coming year. The first three residential projects in
Indore, Coimbatore and Nagpur are underway for launch in 2012 and the first
Commercial Office Tower, which was presold, is already under construction in
Aurangabad.
The
company’s development model is to build its shopping centres on a horizontal
design supported by ample parking on large tracts of land such that the
residential and offices are at least among 75% of the portfolio. As real estate
asset classes have different cycles, Prozone CSC business model is to provide a
stable mix of long term annuity revenues and short term cash flows to optimize
the balance sheet and minimize short term risk.
The
new company is modeled around CSC and will harness CSC’s 35 years of
international mixed-use real estate development expertise. CSC is amongst the
top 20 REIT’s in the world (Real Estate Investment Trust) largely
focused on shopping centre management and development and is UK’s no 1
specialist developer, owner and manager of pre-eminent regional shopping
centres with 10 of their shopping centres featuring in the top 25 shopping
centres of UK. CSC own 14 retail properties spanning over 16 million square
feet, which attract over 320 million shopper visits per annum, and have over
£7.0 billion of assets under management. CSC’s top shopping centres include The
Trafford Centre, Lakeside, Metrocentre, Braehead, and The Mall at Cribbs
Causeway.
The company
raised 337Cr for a 38.5% stake in project-specific SPVs for the Aurangabad,
Coimbatore and Nagpur locations from Triangle Real Estate India Fund,
co-promoted by ICS Realty Group and Old Mutual Investment Group Property
Investments and LTG International, promoted by Lewis Trust Group, an investment
company that operates retail stores, real estate, wealth management business
and hotels globally.
Mr.
Nikhil Chaturvedi, founder and Managing Director of Prozone CSC Ltd said
“We are designing Prozone CSC to become India’s leading developer, owner and
manager of high quality shopping centres focused on India’s
emerging new urban cities. We will complement our retail schemes with adjacent
mixed-use developments to facilitate the business model”.
Mr
David Fishel, Chief Executive Capital Shopping Centres Group said “India is
an economy which the world is observing; we see a lot of opportunity and are
committed for the long term. We at CSC share a common vision with our partners and
firmly believe in the need to specialize and are increasingly focused on areas
where we produce competitive advantage. Our mixed use centres are built with a
long-term vision and these type of developments have proved to be highly stable
and resilient and an excellent way of locking into the real growth of the
economy.
About
Prozone CSC Ltd
Business
Model
Prozone CSC’s
overarching vision is to develop new urban hubs, consisting of shopping malls,
residential colonies and modern office blocks that evolve as India’s new city
centres. Driven by a focus on execution and led by great teams, the mixed-use
property model is geared to unleash cash flows and unlock value to deliver
sustained long-term growth. Projects are located on carefully selected
large land parcels acquired at sensible entry values at select locations in
high growth corridors within city limits.
Residential
Colonies and Commercial Offices are planned on the conjugant land bank to the
shopping malls, to create new “City Centres” that become the hub of India’s
evolving lifestyles.
Retail is at the centre of Prozone CSC’s
business model. Overall the aim is to provide people with the perfect shopping
experience allowing development of enduring relationships with retailers, which
deliver long-term growth for Prozone CSC’s retail platform and it’s this that powers the business, driving long-term
success. CSC’s experience of over 30 years in this sector ensures
design, quality, management and safety measures to the highest international
standards.
By developing and actively managing the
retail centres to provide the right mix of retail, leisure and catering Prozone
CSC can deliver compelling destinations for shoppers and become the landlord
that retailers want to do business with.
The mall management philosophy is to
develop powerful footfalls and ensure the right trading environment to our
centres. This demonstrates operating excellence and results in attracting a
broad cross section of retailers in order to create long-term and sustainable
growth in net rental income.
India has one of
the highest growth retail sectors in the world. Powered by a robust and booming
consumption story, retail is a prime driver of the new Indian economy and
represents approximately two-thirds of overall consumption. Organised retail is
currently 5% of total at US$ 26 bn, but is growing at over 25% per annum. And
with 100% FDI now allowed for single brand retail and FDI for multi-brand
retail slated to be passed into law, anticipated growth in organised retail is
leading to strong demand for quality trading infrastructure.
Even
with economic indictors marked down to 5.0 to 5.5% GDP growth in the coming
year, India remains one of the world’s most robust economies, fuelling the
demand in the retail sector. However, over the next 5 years we expect there to
be a shortage of quality supply of shopping malls, as increasing interest rates
and uncompetitive land prices have forced cancellations of many retail
developments. Furthermore, some existing shopping malls are struggling due to
high debt burdens providing companies with strong balance sheets opportunities
for consolidation.
Features
of the Indian environment sometimes require differing approaches to traditional
norms. Prozone CSC takes a long term view of value addition that overrides
short term economic or competition cycles in the markets selected. For example
in the Indore and Jaipur markets, Shopping Centres have been cancelled due to
oversupply and instead Residential Colonies alone are being launched. In the
Nagpur and Coimbatore markets the retail and residential developments are being
launched simultaneously.
The
primary concern is to protect the investment portfolio through prudent analysis
of markets and careful deployment of finances. Enormous benefit is derived from
the knowledge and experience of the Prozone CSC Board and key strategic investors,
particularly the Triangle Fund and the Lewis Trust Group.
Always
our primary concern is to protect the investment portfolio through prudent
analysis of markets and careful deployment of finances. Fundamentally we are in
the business of value addition and so we engage best in class consultants,
contractors and designers to deliver optimum value to our customers. Although
our residential developments will release large amounts of cash into our
balance sheet, our clear strategy is to focus on becoming India’s leading
retail real estate business with a view to maximizing long term yields to our
shareholders.
Development
Philosophy
Understanding
your customers and delivering what they need, at the right place, at the right
price at the right time is the core philosophy behind Prozone CSC. Design,
quality, execution and management are centred on the rapidly evolving needs and
aspirations of Indian families.
Shopping Centres
spaces are designed for convenience, comfort and to offer real value for money
to provide shoppers with all their needs, in one place for the whole family.
Family residences in large open-space private colonies are completed to the
highest quality standards, with world-class features to create ‘the best homes
in India.’
Prozone CSC is
committed to deliver its properties perfectly on time and to exceed customers’
expectations on the quality of finishings, services and amenities. To ensure
this promise, projects are only launched when all permissions and finances are
in place. Prozone CSC has engaged only best-in-class contractors and
consultants and incorporate international best practice in design and use of
materials. This philosophy to deliver the very best is supported by a strong
campaign to attract the cream of national retailers and the local communities
to the schemes.
Regional Shopping Centres
With
an experienced mall management team in place, supported by the knowledge and
experience of Capital Shopping Centres Group Plc, from the UK, the shopping
public is assured an enriching, valued and safe environment.
The Prozone Aurangabad mall was
successfully launched in October 2010. Anchored by India’s leading retailers,
the mall has operating with of 79% of its retails spaces filled. In a city of 1
million people, the mall is averaging 800,000 customer visits per month and is
acclaimed as the major shopping and entertainment hub for the Marathwada region
of Maharashtra.
Prozone Aurangabad mall is frequented by
crowds of families, youngsters and visitors from wide parts of the region.
Adding fuel to the attraction, the mall has also become popular for its
frequent special events, which have caught the imagination and have become part
the local recreation calendar.
The Aurangabad development has proven the
business concept and learnings will enhance further the efficacy of the next
phase of developments. Two further Shopping mall developments in Nagpur and
Coimbatore are well advanced in terms of design and architecture and will go
into development in FY13.
Residential
Colonies
India
is home to 17% of the world’s population but has only 3% of the world’s land
mass. India’s consumption story is fuelling a massive urbanization that is
anticipated to result in over 50% of India’s population being urbanized by
2020. This puts pressure on the already burgeoning real estate prices in major
Metro’s such as Mumbai and Delhi and is expected to give rise to the emergence
of new urban centres in Tier II cities with strong economic growth drivers and
infrastructure. Demand for housing in these cities is relentless and Prozone
CSC intends to serve this demand by developing Residential Colonies to high
international standards.
Omni
Infrastructure Private Limited, an SPV of Prozone CSC, is launching a
residential township in Indore on approximately 40 acres in 2012. The vision is
to create homes with all modern amenities on the lines of successful
international residential developments consistent with the image of the Prozone
CSC brand.
Prozone
Sojatia Palms is a majestic residential space providing true style of
International living, comprising of 896 high-rise apartments in the first phase
of the project. The aim is to create a modern residential township never seen
in Indore before; Prozone Residences are designed not just as a way of living,
but also as a lifestyle.
A
team of leading architects and consultants has designed Prozone Sojatia Palms
in every minute detail to ensure optimum value, convenience and on-time
delivery to their customers. The township is unique in design matching premium
residential standards in ambience, which redefines luxury and aspirational
living.
A grandiose
entrance encompassing high levels of security welcomes a stylish avenue road
lined with majestic palm trees that sets in a feeling of satisfaction and a
realm of tranquility. The scenic splendor of the beautiful landscape has been
designed by Site Concepts International, Singapore-based Landscape
Architectural consultants. All of the landscape areas are interconnected with a
lengthy and wide walking/jogging path around the perimeter of the space and
separate play areas for kids, free from vehicular movement, ensures safety for
the children.
A members-only
residential club of around 10,000 square feet, with banqueting, swimming pool,
Jacuzzi, spa/sauna, outdoor games like lawn tennis, cricket practice net,
basketball and indoor games like squash and badminton will make this an ideal
family centric community.
Commercial
Offices
Experience from
other markets, reinforced by Prozone’s experience in the first development in
Aurangabad has proven that people want to work nearby great retail and
entertainment destinations. Companies are also keen to move their Offices into
these locations as it attracts and retains the best workforce. Commercial
developments therefore form the third tier of Prozone CSC’s development model –
designed to create India’s City Centres of the future.
Despite average
excess inventory in the Office sector, there exist pockets of supply demand
imbalance, which is where a specialist player such as Prozone CSC can benefit.
For example talent pools for many industries prefer to work within mixed-use
developments and many Corporates prefer such spaces as it attracts and retains
the best staff.
In Aurangabad, four commercial office
towers above the mall totaling 774,000 square feet have been designed,
necessary approvals obtained and first phase construction has begun. The first
phase of 190,000 square feet was sold within its first week of launch.
For Further Information:
Virendra Verma / Snehal
Vaidya
Adfactors PR Pvt Ltd
91-2267574444
This comment has been removed by the author.
ReplyDelete