DLF Cyber City Developers Ltd (DCCDL) is a joint venture of DLF (1) and GIC Pte Ltd, a sovereign fund based in Singapore. It is the rental arm of DLF Ltd, the largest real estate firm in India. On Sunday, it secured 2,400 Crore INR from SBI, State Bank of India, in one of the largest LRD, Lease Rental Discounting deals in recent times.
When banks are cautious of financing real estate developers, the debt transaction of a 7.35% interest rate for 15 years along a structured repayment schedule will enable DLF to reduce its debt costs.
While commenting on the development, DLF stated that the loan’s size shows its diverse tenant profile and its ability to generate long-term cash flows from its real estate asset portfolio.
While adding further, the Chief Financial Officer of the DLF Group, Vivek Anand, stated that the funding represents a booming endorsement of the company’s commercial portfolio. Despite the present uncertainty, the team is committed to reducing their borrowing cost and creating long-term value for stakeholders.
DLF to Refinance Existing Debt and Expand the Company with the Latest Loan
Anand added that the company would utilize the majority of the loan to refinance its existing debt. It would also use its balance fund for future expansion.
Notably, DLF has refinanced approximately 1,950 crore INR debt while using the remaining 450 crore INR for its future expansion. At present, the company has a total obligation of about 19,500 crore INR.
DLF holds a 66.66% stake in DCCDL while GIC is keeping the rest. Currently, the rental arm is generating an annual rental income of about 3,500 crore INR.
Moreover, the DLF group has an operation rental asset portfolio with 35 million sq fr in the country with more than 1600 tenants. It is noteworthy that 60% of these tenants are Fortune 500 companies.
Notably, the Delhi headquartered company is the largest publicly listed real estate company in the nation. It has retail, residential, and commercial properties in 15 states and 24 cities across India. Moreover, their team is dedicated to developing ecosystems for the changing needs of Indian customers.