Business News from Sri Lanka: A consortium of leading local banks, comprising the Bank of Ceylon, NDB Bank and National Savings Bank has raised a syndicated loan of US$ 25 million (Rs 4.5 billion at current rates) for Sri Lanka’s showpiece high rise property development Altair, in a noteworthy vote of confidence in the prospects for the project as well as for the sector in general.
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.
This infusion of funds is in addition to the US$ 251 million (Rs 45.6 billion) 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 US Dollar component and Sri Lanka Rupee component is repayable in 18 months with a grace period of six months.
Altair, Indocean Developers Director Pradeep Moraes said: “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 NPL ratios in the banking sector. We commend the three banks for their positive approach to the opportunity presented by Altair.”
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.
Altair is a one-of-its-kind development in South Asia in terms of architectural design, structural engineering, and living experience. Structural construction has been completed and 70 per cent of its apartments are already sold.