Indocean Developers borrows US$25mn to finish Sri Lanka’s Altair high-rise

ECONOMYNEXT – Indocean Developers has borrowed 25 million US dollars (4.5 billion rupees) from three Sri Lankan banks to finish its Altair high-rise with 400 apartments.

The syndicated loan is from a consortium of banks, Bank of Ceylon, NDB Bank and National Savings Bank, a statement said.

“One of the largest syndicated loans in Sri Lanka’s property development sector in recent times, the loan is intended to ensure cash flows at the final stages of completion of the Altair project are maintained at optimum levels of liquidity,” the project’s promoter Jaideep Halwasiya of Indocean Developers said.

The statement said the loan is “a noteworthy vote of confidence in the prospects for the project as well as for the sector in general.”

The infusion of funds is in addition to the 251 million dollars (45.6 billion rupees) that has already been invested in Altair by stakeholders, whose offshore investments are subject to the statutory limits specified by the Reserve Bank of India (RBI).

The syndicated loan, made up of a US dollar component and Sri Lanka rupee component, is repayable in 18 months with a grace period of six months.

“This is a significant development not just for Altair, but for the property development sector in general, in the context of current sentiment in the market and the rising impairment charges and (bad loan) ratios in the banking sector,” said Indocean Developers Director radeep Moraes.

The short term syndicated loan was arranged by NDB Investment Bank Limited (NDBIB) and Bank of Ceylon.

In a letter to buyers of apartments at Altair, Indocean Developers said the security offered under this loan is the only encumbrance placed on the project.

Structural construction of Altair has been completed and 70 per cent of its apartments, priced from 525,000 dollars to two million dollars, are already sold.

Story continues below
Advertisement
Story continues below
Advertisement

The building comprises of two tower blocks – a 63-storey sloping tower leans in to a taller, 68-storey vertical tower.
(COLOMBO, 08 October 2019)