Qatar fund QIA to invest $300 million in realtor RMZ in one of largest investment deals
The Indian real estate sector, sovereign wealth fund Qatar Investment Authority (QIA) is investing $300 million ( Rs 1,800 crore) in Bangalore-based real estate developer and South India's largest office space builder RMZ Corp
Jul 23, 2013
Source : The Economic Times

 

BANGALORE: In one of the largest investment deals in the Indian real estate sector, sovereign wealth fund Qatar Investment Authority (QIA) is investing $300 million ( Rs 1,800 crore) in Bangalore-based real estate developer and South India's largest office space builder RMZ Corp, said three people with direct knowledge of the development.

"The deal is in advance stage. QIA has committed to give money, and it will be based on project requirements. The investment will be equally split into a combination of equity and debt," said the first person.

The money will come into the same special purpose vehicle (SPV) where private equity fund Baring Private Equity Partners (BPEP) had invested 500 crore last year. BPEP has a 28% stake in the SPV, which is a group company of RMZ, while the rest is held by the builder. In 2012, BPEP backed the builder to buy 50-acre or 6 million sq ft space for office development in Bangalore.

"QIA will invest in the same SPV as BPEP and will back RMZ to buy IT parks worth 3,000 crore. Jointly, both partners will look at acquiring commercial spaces across Bangalore, Hyderabad, Chennai and Pune. RMZ has already identified the project and the money is expected to be deployed by March 2014," he said.

Raj Menda, managing director RMZ Corp, could not be reached for comment, while an email sent to QIA remained unanswered.

QIA has a track record of investing in different asset classes, including listed securities, property, alternative assets and private equity across major capital markets as well as emerging markets. The Doha-headquartered fund had earlier said real estate is a key area of investment, and it is willing to invest $10 billion over the next few years.

The family-owned RMZ Corp with a portfolio of over $3 billion is also looking to list its office properties by 2015 through Real Estate Investment Trust (REIT) in markets such as Singapore and Thailand. Currently, the firm has 84 lakh sq ft of office space across India, with additional 60 lakh sq ft under development. "RMZ is looking at a portfolio of 20 million sq ft of office space under its portfolio before it goes for listing. The company needs to have a sizeable portfolio for listing its assets," said another person.

Many sovereign and pension funds are planning to invest directly in real estate projects in a bid to get higher returns and direct control of the projects. Recently, Abu Dhabi Investment Authority (ADIA), which manages the surpluses the Gulf Emirate earns from oil exports, appointed Kotak Realty Fund to invest on its behalf, followed by Oman's State General Reserve Fund's investment in HDFC Property Fund, the private equity arm of Housing Development Finance CorporationBSE -0.27 % (HDFC).

 "Sovereign funds are long-term driven and conservative in return expectations compared to private equity or hedge funds. These are cheaper, low-risk and low-return capital," said Ambar Maheshwari, managing director - corporate finance, Jones Lang LaSalle.

 

 

Latest Realty News

Karnataka to raise Rs 1,000 crore for IT investment region project
Jul 23, 2013
BANGALORE: Karnataka plans to raise a loan of Rs 1,000 crore to acquire land for the Information Technology Investment Region (ITIR) project. The project is to come up near theKempeGowda International Airport.
Government eyes to garner Rs 840 crore revenue due to guidance hike
Jul 23, 2013
BANGALORE: Karnataka government expects additional revenue of Rs 840 crore following upward revision of guidance market value of properties, including Rs 614 crore in Bangalore Urban district, by way of increase in registration fee and stamp duty following the measure.
Karnataka to protect home buyers from fraudulent developers
Jul 16, 2013
BANGALORE: The increasing complaints against developers and promoters of housing cooperative societies has caught the Karnataka government’s attention, which has decided to put an end to it.
Office space absorption drops 15% in the first half of 2013
Jul 16, 2013
BANGALORE: Office markets in India registered a downward trend in absorption in the first half of the year. The total net absorption across top eight cities in H1 2013 was noted at 10.9 mn sft, a decline of 15% compared to the same period last year, says Cushman & Wakefield in its latest report.
Karnataka govt’s registration policy causes it big revenue loss
Jul 16, 2013
BANGALORE: The actual market value of one square foot of land on 11th Main in Jayanagar IV Block is Rs 40,000. But the guidance value fixed by the government is just Rs 11,000. All property transactions on this lane are registered on the guidance value – legally the right thing to do though it ends in substantially less money flowing into the government’s coffers.
Office space absorption drops 15% in the first half of 2013, says report
Jul 16, 2013
BANGALORE: Office markets in India registered a downward trend in absorption in the first half of the year. The total net absorption across top eight cities in H1 2013 was noted at 10.9 mn sft, a decline of 15% compared to the same period last year, says Cushman & Wakefield in its latest report.
Retail hubs emerging in peripheral localities of Bangalore
Jul 12, 2013
BANGALORE: Over the last couple of years, Bangalore’s retail landscape has witnessed an upward spike with several national and international brands setting up shop in the city. Favourable demographics, rising per capita income and easy availability of credit have fuelled the growth of Bangalore’s retail market. Residential catchments in the vicinity benefit from better entertainment for the family, shopping convenience, hospitality options, and higher rentals and capital appreciation for investo
Office space in demand in North Bangalore
Jul 12, 2013
BANGALORE: The north of the city continues to witness a surge in demand for office and residential spaces. Though sizeable chunks of land have already been designated for an aerospace, IT and BT Special Economic Zone (SEZ) the demand from private players for realty development is huge.
HDFC AMC to sell stake in Nitesh Housing to promoter
Jul 11, 2013
BANGALORE: HDFC Asset Management Company, the portfolio manager of HDFC Mutual Fund, has decided to sell its entire stake in Nitesh Housing Developers, a subsidiary of Bangalore-based Nitesh Estates.
Karnataka plans to regularise unauthorised buildings in govt land
Jul 09, 2013
BANGALORE: Karnataka government has planned to introduce an amendment to the Karnataka Land Revenue Act 1964, to regularise unauthorised constructions of dwelling houses in government lands in urban areas, official sources said.

Latest Realty News Of State

Realty Talk's