IL&FS Investment Managers Ltd has picked up a 49% stake in the company's proposed SEZ in Gurgaon for Rs160 crore paying part of the cost of the land acquisition there. HDFC Property Ventures, the real estate investment arm of the eponymous bank, has also picked up a 33% stake in Ansal's SEZ in Greater Noida for approximately Rs40 crore. A HDFC spokesman said that senior executives of the company could not be reached for comment.

Work on the Raheja's SEZ has started and the first phase of the project consisting of 255 acres is expected to be completed in between three and five years, Navin Raheja, chairman, Raheja Developers said. Raheja is negotiating with both Indian engineering manufacturers and foreign engineering firms to take space within the SEZ.

Abhishek Gupta, head of research, Jones Lang LaSalle, India said developers were attracted to SEZs since it was "less risky than retail or residential". But, "the demand for IT space is still there but supply which was not there two to three years ago is expected to double and treble and this will create a temporary situation where supply exceeds demand," he added, predicting this would put pressure on rentals at SEZs.

Development of SEZs has been a controversial subject because of land acquisition issues as farmers and land owners have protested their land being converted into such zones.

In Raheja's case, the company said that it did not face any such issues because it acquired the land directly from the land owners at the market price. "We did not ask the government to acquire land for us," Raheja said. "As part of our agreement with the land owners, we have agreed to give employment to two persons from the family of land owners for every five acres acquired from them."