Mega project at Tellapur caught in row between builders, government

Hyderabad: The Tellapur mega integrated township on the city’s outskirts has run into trouble with real estate firm Tishman Speyer asking the Telangana state government to either allow it to take up the project in 100 acres or return the money that was paid almost a decade ago.

The public private partnership project was conceived by the YSR government in 2007 to develop a special economic zone on 400 acres of land for IT companies, offices and residential spaces, close to the Outer Ring Road.

The developer, Tellapur Technocity Pvt Ltd, proposed to build the SEZ with a consortium led by Tishman Speyer, a multinational construction company, the Nagarjuna Constructions Company and ICICI along with the erstwhile HUDA on a revenue-sharing model.

Tishman Speyer then signed a memorandum of understanding and paid Rs 420 crore to the government for 100 acres, at Rs 4.21 crore per acre. The township was to have been completed in eight years with a 30 million square feet built up area. The total deal was worth Rs 1,700 crore for 400 acres.

The rest of the money was to be paid within six months but the developer failed to do so citing a slump in real estate markets and the project did not move forward. In 2010, the consortium then approached the HMDA to revive the project.
After the state was formed in June 2014, company officials met IT minister K.T. Rama Rao and sought the government’s help.

The municipal administration and urban development department constituted a committee to examine the issue and recommend the future course of action. But two years hence, there has been no progress.

A senior municipal administration official said, “The company had written to the state government in February this year requesting it to register 100 acres in its name and allow it to take up the  project or return the money it had paid in 2007.

It also sought permission to change the shareholding of its partners in the JV.” The official said the company was supposed to share five per cent of revenue earnings on project with HMDA as per MoU but it now wants it to be reduced to 1.5 per cent.

“Since these issues have financial and legal implications, the government is now seeking views from various quarters due to which there has been a delay in responding to the company’s fresh proposals,” he added.

But vexed with the delay in securing approvals, getting the rest of the land and creating the required infrastructure, Tishman Speyer has shot off a letter to the government to either take a decision on revival or allow it to exit.