BENGALURU: Ascendas India Trust -has entered into a definitive agreement to acquire commercial property from Phoenix Group in a deal valued at Rs 506 crore.
The IT SEZ building, aVance 6 at HITEC City, Hyderabad is spread over 6.3 lakh sft and is around 98.3% of space is leased to Amazon Development Center.
The proposed acquisition will be the fifth building acquired by a-iTrust from the Phoenix Group. In February 2012, a-iTrust acquired aVance 1 & 2, totaling 427,700 square feet, followed by the buyout of aVance 3, totaling 682,900 square feet and in April 2017, a-iTrust further acquired aVance 4, totaling 390,000 square feet. aVance 5 is currently under construction.
Sanjeev Dasgupta, Chief Executive Officer of the Trustee-Manager said, “The proposed acquisition provides a-iTrust an opportunity to scale up our presence in HITEC City and will add Amazon as a tenant to our IT park portfolio. The improving connectivity and enhancement work being carried out at aVance, HITEC City, Hyderabad would benefit our tenants in the future. We have already started seeing some leasing traction, with a large US based MNC having executed a Letter of Intent to lease aVance 5.”
Ascendas India Trust (a-iTrust) was listed on the Singapore Exchange Securities Trading Limited (SGX-ST) in August 2007 as the first Indian property trust in Asia with principal objective to own income-producing real estate used primarily as business space in India. The Si Trust may also develop and acquire land or uncompleted developments primarily to be used as business space, with the objective of holding the properties upon completion.
As on 31 December 2020, a-iTrust’s asset under management stands at S$2.1 billion. a-iTrust’s portfolio comprises seven IT business parks and one logistics park in India, namely the International Tech Park Bangalore, International Tech Park Chennai and CyberVale in Chennai, International Tech Park Hyderabad, CyberPearl, and aVance in Hyderabad, aVance in Pune and Arshiya warehouses near Mumbai.
India’s property sector is expected to continue to see increased interest from global investors and higher allocation of long-term capital given the limited growth opportunities in other developing markets. In 2020 two major deals- the Blackstone Group taking over of 21 million sq ft of completed and under construction office, retail and hospitality assets from Prestige Estates for around $1.2 billion and the Brookfield Group picking up RMZ Developers’ 12.5 million sq ft office and co-working assets for $2 billion indicate the continued interest in India and office properties that account for a major share of the portfolio deals.
Institutional investment in the Indian real estate staged a smart recovery during Q4 2020 with $ 3.5 billion investments. As a result, 2020 closed with $ 5 billion investments, equivalent to 93% of 2019 transactions (USD 5.4 billion), despite a sudden halt brought on by the pandemic according to JLL.
