Unitech to develop Vizag Knowledge City

Unitech Ltd has struck a pact with the Andhra Pradesh government to set up the Vizag Knowledge City on 1,750 acres of land near Vishakapatnam, for which it will pay Rs 3,328 crore over a ten-year period.

At Rs 52 lakh per acre it may not be the most expensive deal in the country, but it is among the largest in terms of the acreage from a single source in a single deal.

The Andhra Pradesh Industrial Infrastructure Corporation (APIIC) had invited bids to develop the land for the Integrated Vizag Knowledge City. Dubai-based Al Hamra Real Estate Development LLC had also qualified for the bid, but dropped out in the final stage.

Unitech executives said that the company will invest more than Rs 20,000 crore (which includes the cost of the land) to develop a total 10 million square feet of built-up space Into an infotech park.

There will be villas, high-rise apartments, shopping centres and hotels as well as school and hospitals, an entertainment park and a 250-acre golf course. Unitech expects sales of Rs 75,000 crore from the project.

Unitech declared land reserves at 10,700 acres in September 2006. But while the company continues to acquire land, it is not giving details.

"We will make an announcement when the acquistion process has been completed. We are focussing on larger opportunities and avoiding participation in overpriced land auctions," Managing Director Sanjay Chandra said.

"This route will help us create a diverse portfolio, offering products at different price points, thereby increasing our sales and customer base."

Unitech's rival DLF recently won the bid to develop the New Bangalore township on 9,000 acres, at Bidadi, near Bangalore.

While the Rs 60,000 crore project is the largest by size and investment, only a part of the land will be made available by the state government and the rest will have to be acquired directly from farmers at about Rs 56 lakh an acre.

It is not yet known how much land DLF will get from the government and how much it will have to purchase from farmers.

Unitech held the record for the most expensive land deal till August for a 300-acre buy at Rs 1,582 crore In Noida last year. That was surpassed by DLF which bought 38 acres in west Delhi for Rs 1,675 crore from DCM Shriram Consolidated Ltd and the Lohia Group.