The recent bloodbath in the real estate sector has started taking a toll. Almost all large developers are facing a severe cash crunch and finding it difficult to complete their ongoing projects. The situation is so bad that most of them have reported a 50-70% cash shortfall. Liquidity crunch has forced many developers to pick up cash from the unorganized market at interest rates as high as 35% to 50% annually. The lending rate of banks is between 18% and 20%. The grade A developers which are facing crash crunch include DLF, MGF Emaar, Shobha Developers, Unitech, Omaxe, Parsvnath Developers, Hiranandani Group, Ansal API, BPTP Developers and TDI Group.
Courtesy: ET dtd. 20/06/08