Pension, sovereign funds eye Mumbai’s commercial complex
To acquire 1.12-million-sq-ft commercial property 247 Park in Mumbai
Dec 19, 2014
Source : The Economic Times


MUMBAI: Global pension and sovereign funds including Canada Pension Plan Investment Board (CPPIB), APG, Abu Dhabi Investment Authority are in talks with private equity firm Milestone Capital to acquire 1.12-million-sq-ft commercial property 247 Park in Mumbai, two persons familiar with the development said.

The deal, expected to be valued over Rs 1,000 crore, indicates the rising appetite for incomeproducing office properties.

Milestone Capital owns majority 74% stake in the property located on LBS Marg in Mumbai's Vikhroli suburb, while the rest 26% is with Hindustan Construction Company (HCC). Dutch pension major APG is negotiating along with its India alliance partner Xander Group, while Shapoorji Pallonji Group is driving the discussions for CPPIB.

Blackstone Group is in advanced talks with the property's joint owners to acquire it for over Rs 1,000 crore. Its negotiations for the property had started more than a year and half ago. However, the transaction has not reached conclusion due to differences between joint owners on the structure of the proposed deal, which in fact, led to talks that the deal has been called off. 247 Park is a nearly 100% leased property counting Siemens, Piramal Group, Future Group, KEC, HCC, DHL, APL and Tata Group as its key tenants. Being a fully leased out commercial complex, 247 Park fetches annual rental income of around Rs 100 crore with most of its built-up area comprising IT-ITeS and commercial offices along with a large format retail store.

ET's email queries to APG and Abu Dhabi Investment Authority remained unanswered till the time of going to press, while Xander Group and Shapoorji Pallonji Group, in their separate responses, said they do not comment on market speculation. CPPIB also said it does not comment on speculation on deals.

Sovereign wealth fund owned by the emirate of Abu Dhabi, according to persons mentioned above, is looking to acquire the asset independently. Last year, ADIA had committed $200 million to Kotak Realty Fund to invest in Indian real estate. Kotak Realty has denied holding any talks for the asset 247 Park on behalf of ADIA. Milestone in an email told ET, "We are unable to comment anything at this moment.We will update you on our plans at an opportune moment."

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