The Indian arm of Dubai-based real estate developer Emaar Properties has joined forces with Worldwide Resorts & Entertainment to execute a joint development project on a 73.60-acre land parcel in Gurgaon. The project is valued at Rs 278 crore, according to sources familiar with the matter.
The agreement, finalized in June 2023, marks Emaar India’s third joint development deal since December 2021. In August 2022, Emaar India teamed up with Synergy Finhub for a 17-acre land project, involving an investment of Rs 345 crore. In December 2021, Emaar and Worldwide Resorts & Entertainment signed a joint development agreement for a 119-acre land parcel, with a financial commitment of Rs 375 crore.
A reliable source stated, “In under two years, Emaar has secured three JDAs, guaranteeing a minimum of Rs 1,000 crore. This arrangement operates on a revenue-sharing model, where the partnered developer manages construction and shares 30% of generated revenue with Emaar.”
ET has reviewed official land registration documents related to these transactions.
Both Emaar India and Worldwide Resorts & Entertainment Pvt. Ltd., as well as Synergy Finhub, did not respond to ET’s email queries.
As per the agreement, the new developer will remit 30% of their net sales to Emaar.
In a recent interview with ET, Mohamed Alabbar, Emaar Properties’ founder, expressed the company’s plans to intensify its focus on the Indian market. Alabbar stated, “The Indian hospitality sector holds great promise due to encouraging supply and demand dynamics. Residentially, the limitless demand in India speaks for itself. When it comes to retail mall business, India is at its inception stage. Hence, our strategy is to concentrate on these sectors, particularly in India’s major cities.”
Emaar Properties entered the Indian market in 2005 with the largest FDI in the realty sector at that time, investing about Rs 8,500 crore through its collaborative venture, Emaar MGF Land.
However, in April 2016, Emaar decided to dissolve this joint venture, leading to the resignation of Shravan Gupta, the then Executive Vice Chairman and Managing Director of the partnership, two months later. The demerger was eventually approved in July 2018.
Currently, Emaar and its former partners are embroiled in a legal dispute. Alleging fraudulent practices in joint venture agreements and land transactions, Emaar filed a petition with the National Company Law Tribunal (NCLT) in November 2019, urging an investigation. Additionally, they are seeking compensation of Rs 2,400 crore through a bank guarantee to cover their losses. MGF, however, has strongly refuted these allegations.
Reflecting on the journey, Alabbar remarked, “When we ventured into India two decades ago, we were a young company, and we’ve learned a great deal since then. We acknowledge our missteps. Our business approach is focused on the long term, and we’ve realized that we aren’t always compatible with partners seeking short-term gains.”