Blackstone may buy Adani’s BKC property
MUMBAI: Blackstone Group LP is in talks to acquireAdaniRealty’s commercial office project at Mumbai’s Bandra Kurla Complex (BKC) for around ₹1,900 crore, said two people aware of the matter.
The private equity firm stepped in after Shapoorji Pallonji Investment Advisors Pvt. Ltd backed out from buying the 10-storey building in Mumbai’s latest financial district, said the two people cited above. The investment arm of the Shapoorji Pallonji Groupwasthefrontrunner for the deal and even completed aduediligence of theproperty, they said.
“Discussions withBlackstone are underway. Termsandconditions of the deal are being negotiated,” said the first person mentionedabove, addingthatthedeal is likely to be closed before the end of this fiscal year.
Spokespersons at Blackstone and Adani Realty declined to comment. A spokesperson of Shapoorji Pallonji Investment Advisors did not respond to an email until press time.
The800,000 sq. ft project called ‘Inspire’ wasdevelopedbyAdani Group’s real estate company. Swiss pharmaceuticals firm Novartis is one of the building’s biggest tenants, havingpickedup around 100,000 sq. ft last year.
The last couple of years have seen Blackstone lap up some of the marque commercial properties in India.
This year, it has signed a slew of deals with Indiabulls Real Estate Ltd. In March, Blackstone boughta50% stake in Indiabulls’ flagship office properties in central Mumbai—One Indiabulls Centre and Indiabulls Finance Centre—for $730 million. It also boughtoutMumbai-basedfirm’s Chennai commercial asset for ₹900 crore.
In BKC, Blackstone is close to buyingOneBKC, a1.5 million sq. ft commercial office complex ownedbyMumbai-basedRadius Developers for over ₹2,300 crore. Thepropertyisconsideredoneof the marque projects, housing large multinational firms like FacebookInc., Amazon.comInc. and Bank of America Merrill Lynch, among others.
Sofar, Blackstone Real Estate hascommittedmorethan$5.3 billion across 31 investments in India.
It comprises $3.9 billion in office assets covering 100 million square feet.
Grade A office properties in BKC have gained interest from several investors and financial institutional firms. Withmonthly rentals of around₹220-350 per sq. ft and growing at an annual rate of 2.7%, BKC is one of the most expensive commerciallocations in Mumbai, according to Colliers International, a property advisory firm.
Meanwhile, despite the slowdownintheresidential segment, demand for commercial office space continues to grow.
Some large commercial office deals havebeensignedinthepast year. Singapore-basedrealestate asset managerMapletreeInvestment Pte. Ltd signed one of the largest deals this year byacquiring Chennai’s information technologyparkSPInfocityfor₹2,400 crore. The park is jointly owned by Canada Pension Plan Investment Board (CPPIB) and Shapoorji Pallonji Investment Advisors.
Other big ticket size deals include Canada’s Brookfield Asset Management Inc. buying EssarGroup’sEquinoxBusiness parkfor₹2,400 crore andAscendas-Singbridge Groupbuyingtwo upcomingofficebuildingsinNavi Mumbai’s Aurum Platz IT Park for ₹930 crore.