India's cash-rich Lodha Group is betting big on London's high-growth property market by making the largest foreign direct investment in the UK's real estate sector, the Indian media reports.
"London is an exciting market with shortage of housing. We plan to buy existing assets for $3 billion and spend another $2 billion in developing them in the next five years," Abhishek Lodha, managing director of Lodha Group, told TOI.
"We had cash flows of Rs 2,500 crore [£250m, $410m, €318m] last year and this year it will be even higher."
The newspaper added that the group's proposed deal makes the largest foreign direct investment in the UK's realty sector.
"Currently, our own cash flows are sufficient to meet our expansion and growth plans. As and when we have plans which cannot be met with our internal cash flows, of course we will look at other avenues including a potential initial public offering," Lodha told Financial Express.
The company wants to be among the top two property developers in London, taking on local firms such as Berkeley and Barratt Development.
It forayed into the London property market last year with the purchase of the former Canadian High Commission building in Mayfair for £306m. It also bought another property in central London for £90m.
Lodha Group is a high-profile builder in India with about 6,000 acres of land with development potential of 580 million square feet. It is building the world's largest residential building in Mumbai – the 117-floor World One project which is expected to be completed by 2016.
The company is also developing the 4,000-acre Pallava City in the Mumbai suburb of Dombivali that can accommodate over 400,000 families.
Lodha Group earlier said it expects to record 90bn rupees in revenues in the current fiscal year, up 12.5% from last year.
Foreigners who invest in London property are increasing day by day due to the assets' safe-haven status.