At least half-a-dozen companies have either announced real estate projects with their partners or monetised their prime land assets in the last three to four months.
The reason: Home prices in cities like Mumbai and Pune have shot up surpassing the record levels of 2007-08, after seeing a drop of 30-40 per cent last year as home buyers postponed purchases.
Textile company Arvind today said it will develop 10,00,000 square feet of residential complex in Ahmedabad, with its joint venture partner B Safal Group. The land is owned by Ashoka Cotsyn, a unit of Arvind.
Arvind already announced its plans to unlock around 600 acres of land in and around Ahmedabad and floated a separate subsidiary Arvind Infrastructure to pursue its real estate dreams.
Mumbai-based cable manufacturer Cable Corporation of India (CCI) is also looking at developing real estate projects across western India. Its maiden project in Borivali area of Mumbai is expected to cost around Rs 1,000 crore. Incidentally, the company's Borivali land used to house its main plant will be shifted to Nasik in Maharashtra.
Hiten Khatau, chairman and managing director of CCI said the company has received booking for 70 apartments in its Mumbai project where it will develop 700 flats.
Recently, the Rs 3,500-crore (Rs 35 billion) steel wire maker Usha Martin launched an affordable housing project in Boisar, on the outskirts of Mumbai, and plans to launch similar projects in Pune and Bangalore by the year-end.
While these companies have ventured into property development, some others such as Golden Tobacco and Hindustan Composite have sold off their Mumbai land for Rs 570 crore and Rs 591 crore (Rs 5.91 billion), respectively.
The buyers, Wadhwa group and Sheth Developers respectively, have launched residential projects on the former mill lands.
According to property consultants, Borosil Glass Works is also on the verge of finalising the buyer for its 18-acre land in Andheri area of Mumbai where it is expecting Rs 800 crore (Rs 8 billion) to Rs 1,000 crore (Rs 10 billion).
"In good times, corporates put money behind real estate and when times are bad and they need capital, they monetise these assets," said Ambar Maheshwari, director, investment advisory at property consultant DTZ.
However, according to Pranay Vakil, chairman of property consultant Knight Frank, the trend started around 10-12 years ago, with textile companies such as Mafatlal and Shakti Mills among others went into property development in Mumbai.
Even corporates such as Bombay Dyeing and Century Textiles are developing swanky office complexes on the land in Worli which were once textile mills.
"The only difference is that today land values are far higher. I think what mill owners got at the end of five to six years ago, today new entrants get that upfront," Vakil said, adding, "For sellers, inertia pays rich dividends."
Besides, the Mumbai property market also saw Jet Airways entering a joint development venture with Godrej Properties for its land in Bandra Kurla Complex when it faced liquidity issues earlier and the property market declined.
Even Reliance Industries (RIL) is on the verge of entering a joint development with Mumbai-based Wadhwa group in its BKC plot for a Rs 1,000 crore deal.
Vakil said the brand name of a corporate does not ensure similar brand recall in real estate development also. "It takes time to build a brand in the real estate segment."