BIRET-GIC To Acquire 2 Assets From Brookfield Funds For $1.4 Billion

Brookfield India REIT (BIRET) and Singapore's GIC on Friday announced an equal partnership to acquire two commercial properties in India for $1.4 billion or Rs 11,225 crore.

The two assets in the financial capital and Gurugram have a built-up area of 6.5 million square feet, and are presently owned by Brookfield Asset Management's private real estate funds, BIRET said in a statement.

 

The two properties are Brookfield's Downtown Powai, which is a portfolio of nine commercial properties spread over three clusters having 2.7 million square feet of operational area and 0.1 million square feet of area under expansion, and Candor Techspace in Gurugram's sector 48, which has over 3.7 million square feet of operational space and three-fourths of it is classified as committed occupancy.

This is a first-of-its-kind partnership In India between a listed REIT (real estate investment trust) and a global institutional investor.

 

BIRET proposes to fund the acquisitions through an institutional placement of up to Rs 3,500 crore and may also consider other forms of fundraising, including preferential allotment.

“This marks our first joint venture with a public REIT in India and will allow us to scale up our investments through this avenue.

We look forward to adding value to the assets, which are well-located within key gateway cities,” GIC'e deputy chief investment officer for real estate, Goh Chin Kiong, said.

 

Its Co-head of real estate for Asia, Kishore Gotety said GIC expects growth in the India office sector to continue, driven by an established IT industry, increased focus by global corporations on digital adoption, and the availability of skilled talent.

Ankur Gupta, the head of real estate in Asia Pacific region for Brookfield said, “Growing and diversifying our India REIT portfolio via accretive transactions is part of our long-term strategy. We are excited about the addition of market leading properties and the meaningful increase in size of the REIT.” The transaction will increase the gross asset value of Brookfield India Real Estate Trust to $3.5 billion and the net asset value to $2 billion.

 

With a 35 per cent increase in total leasable space and a 44 per cent rise in operating area, the acquisition significantly scales the Brookfield India REIT portfolio, the statement said.

BIRET's operating area will increase by 44 per cent and consolidated gross asset value by 73 per cent after the acquisition of the assets, the statement said, calling it “attractive acquisitions”.

 

In the March quarter, BIRET achieved gross leasing of 1.2 million square feet, which includes 0.3 million square feet of new leasing and 0.9 million square feet of renewals.

The adjusted net operating income grew 15 per cent to Rs 244.4 crore from Rs 213.2 crore in the year-ago period.