International BusinessHill County customers told to find investors
Maytas Properties, which is trying to raise finances for completing its Hill County project, is asking its customers to find investors for the project.
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Most of those who have purchased properties at Hill County are software professionals, NRIs and entrepreneurs. The company is betting that they would use their influence with venture capitalists and other funding bodies.
Last week, top officials met some members in the project and made this proposal. The company offered to give unencumbered collateral to prospective investors, with the flexibility to withdraw the money invested in a year. The prospective investors could liquidate the collateral if the company did not repay.
Some members have started approaching venture capitalists, but there is a feeling the effort might not yield tangible results, due to the inherent risks associated with Maytas Properties. It is one of the two companies the jailed founder of Satyam Computers had made an abortive bid to acquire in December last year; Maytas is also run by his two sons. It ran into trouble after it failed to keep its promise of delivering homes at the Rs 1,100-crore Hill County project in March 2008. Hill County, located at Bachupally on the city outskirts, proposed to build 840 apartments and 326 independent bungalows, each priced between Rs 50 lakh and Rs 2.5 crore.
About 55 acres of Hill County (Phase II) is mortgaged with the Hyderabad Metropolitan Development Authority. This would be given back only when the amenities - sewerage, roads and sub-stations and others — are created. The members said this would take time, as Phase-I itself had overshot the deadline by 15-odd months. The title of part of the land at the Bachupally campus is with different companies and Maytas Properties attained developing and selling rights through an agreement with those companies.
Members also said they were not able to register the units in their name as the mortgage was not released. ''This fact was withheld from the buyers at the time of sale of such units,” said a home owner who had paid the full amount and could not register the house. There are 70 independent houses and more than 20 per cent of the flats are in this situation.
The Hill County Home Owner’s Welfare Association, the body formed to protect the rights of the home owners, today represented the issue to different political parties. “The government should order a special audit to validate Maytas Properties’ claims on assets, unsold inventory and the receivables,” the association members said. Adding that the company should fairly compensate customers for the time overruns.
Meanwhile, Maytas Ventures has approached the Centre to surrender its SEZ in Andhra Pradesh, citing economic slowdown and also requested for waiver of over Rs 31 lakh benefit it had availed during the setting up of the project.