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‘Real estate cos may face challenges because of Brexit’

Fitch Ratings agency said the buyers may defer purchases and banks may reduce loans

Policy Pulse
Publish Date: Jul 13 2016 10:32AM | Updated Date: Jul 13 2016 10:51AM

‘Real estate cos may face challenges because of  Brexit’

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Real Estate companies in the country with substantial investments in the London property market will face challenges from Brexit,  global credit rating agency Fitch Ratings has said.

 
According to it, real estate developers have invested in luxury residential and commercial properties 
 
Agency said the buyers may defer purchases and banks may reduce loans due to increased economic uncertainty.
 
Risk to homebuilders in the country will depend on the extent leverage was used to fund their London projects, and whether project construction and marketing sales coincide with the ongoing market volatility, Fitch Ratings said.
 
Two Indian firms Indiabulls Real Estate Ltd and Lodha Developers Pvt Ltd have substantial exposure to the luxury residential and commercial property segments in London.
 
"Both companies made sizeable investments in London's Mayfair and suburbs in 2013 and 2014," Fitch Ratings said.