PHOENIX MILLS-CPPIB RETAIL PLATFORM BUYS PUNE LAND PARCEL FOR $24 MILLION
Island Star Mall Developers Pvt. Ltd, a strategic investment platform owned by real estate developer The Phoenix Mills Ltd and Canada Pension Plan Investment Board (CPPIB), has acquired a land parcel in Pune for `160 crore ($24 million). The 1.6 million sq ft plot at Wakad, Pune, is Island Star Mall’s first acquisition. It plans to develop a premium retail space of one million sq ft. “West of Pune is one of the fastest developing residential and commercial hubs, but yet lacks large-scale retail, entertainment, and food and beverage options under one roof. We will develop our second Phoenix MarketCity in the city,” said Atul Ruia, joint managing director of Phoenix Mills. Earlier, the company had built a Phoenix MarketCity in East Pune.
“This acquisition helps deliver on our strategy of expanding our Indian retail portfolio with Phoenix Mills. Pune’s attractive demographic and economic growth profile combined with an undersupplied retail market makes this an ideal location for a high-quality retail and entertainment destination and is well suited to CPPIB’s long-term investment horizon,” said Andrea Orlandi, managing director, head of real estate investments, Europe, CPPIB.
Phoenix Mills and CPPIB had created the platform in April. CPPIB had initially pumped in `724 crore to own a 30 percent stake in the platform. Subsequently, it plans to invest another `1,600 crore across multiple tranches to own up to 49 percent in the strategic tie-up. Of late, many global investors have shown interest and taken exposure in retail assets through platforms and joint ventures. Blackstone, which has one of the biggest portfolios of commercial real estate in India, has acquired a bunch of retail properties lately. It has also set up a dedicated platform, Nexus Malls, which houses all its retail properties. Dutch pension fund APG had also bought three retail assets of Virtuous Retail, the retail development arm of The Xander Group, to create a platform. an updated framework for establishing REITs have attracted the attention of various private equity funds.