Mumbai-based real estate developer Kalpataru Limited has entered into a joint development agreement with Indian Hume Pipe Company Limited to redevelop the latter’s defunct factory land in Vadgaon Budruk, Pune. According to property registration documents accessed through CRE Matrix, the agreement covers a 14.77-acre land parcel and was executed on May 21 and registered on May 22.
Kalpataru To Develop Residential Project On Former Industrial Plot
The development agreement allows Kalpataru to develop, construct, market, and complete a mixed-use project on the land parcel. Indian Hume Pipe’s manufacturing facility previously occupied this land parcel. The records show that the agreement carries a transaction value of Rs 166.23 crore. Additionally, the parties paid Rs 10.63 crore as stamp duty.
As part of the arrangement, the companies will share revenue generated from the project sales. Kalpataru will receive 67.5% of the revenue, while Indian Hume Pipe will receive 32.5%.
Revenue Sharing Terms Revised Due To Rising Development Costs
Indian Hume Pipe disclosed in a regulatory filing that both companies revised the revenue-sharing ratio from the earlier agreed structure. Initially, Indian Hume Pipe was to receive 34% of the shared revenue, while Kalpataru was to receive 66%.
However, the companies renegotiated the terms after development costs increased significantly and project parameters changed over time.
“The company’s share of shared revenue is re-negotiated to 32.50% instead of 34% and correspondingly, the share of the developer is 67.50% instead of 66% of the shared revenue,” the filing stated.
The filing cited rising development costs, revised regulations, and project expansion as reasons for revising the commercial terms.
Companies signed the initial MOU in 2018
Kalpataru and Indian Hume Pipe had originally signed a memorandum of understanding (MOU) for the same land parcel on September 10, 2018. However, the companies did not immediately complete the formal agreement process.
After more than four and a half years, the parties finalized and registered the development agreement.
Residential Towers And Retail Amenities Planned
According to the documents accessed, Kalpataru plans to build residential towers along with select retail amenities on the Pune land parcel. Before construction begins, authorities will need to convert the plot reservation from industrial use to residential use.
Kalpataru did not comment on the agreement or share additional details about the proposed development plans when approached for clarification.
Pune Land Parcel Has Potential For 1.2 Million Sq Ft Development
Market sources estimate that the Vadgaon Budruk land parcel holds the potential to develop nearly 1.2 million sq ft of residential space. This makes it a significant redevelopment opportunity in Pune’s residential market.
Indian Hume Pipe had operated its pipe manufacturing factory at the site since 1969. The company shut down the facility in November 2015, paving the way for future redevelopment of the land.
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