In an interview with PTI, Company General Manager (MD) and CEO (CEO) Sanjay Dutt said the company has 7 million square feet of leasehold business portfolio, nearly all of which is office assets, and is making huge investments in expansion.

Tata Realty and Infrastructure Ltd will increase its commercial property portfolio to at least 12 million square feet over the next 2-3 years before considering the launch of a public real estate investment trust (REIT) to invest its rental office assets.

In an interview with PTI, Company General Manager (MD) and CEO (CEO) Sanjay Dutt said the company has 7 million square feet of leasehold business portfolio, nearly all of which is office assets, and is making huge investments in expansion.

On Saturday, Tata Realty announced an investment of Rs 5,000 crore over the next 7-8 years to develop a 7 million square feet IT park project in Navi Mumbai in partnership with UK-based investment firm Actis.

Asked if at some point the company would consider going public for REITs, Dutt said, “We will. We already have 7 million square feet. So, technically we can do that (REIT) today.” “But we are thinking that over the next two or three years once we expand our portfolio, then we study the market, we discuss with our partners and then we think about REIT,” he said. Within the next 2-3 years, Dutt said the company intends to expand its portfolio to “at least 12 million square feet” before considering a REIT.

The occupancy level in operational commercial premises is currently around 95 percent. Currently, there are three mutual funds listed on Indian stock exchanges – Embassy Office Parks Parks, Mindspace Business Parks REIT and Brookfield India Real Estate Trust – on Indian stock exchanges.

Apart from IT and data center parks, Tata Realty will also invest in the development of mall projects in major cities such as Delhi NCR, Mumbai and Bengaluru. “We will continue to invest in retail as well,” Dutt said. In late 2019, the company sold two malls in Amritsar and Nagpur to Singapore-based Virtuous Retail South Asia for Rs 700 crore. Dutt said the company divested these retail assets because it wanted to focus on big cities.

Out of the total portfolio of 7 million sq ft, the company currently has a 3,00,000 sq ft multi-level car park retail project in Gurugram, Haryana.

As part of its expansion plan, Tata Realty on Saturday laid the foundation for its new IT project ‘Intellio Park’, sprawled over an area of ​​47.1 acres in Gansoli, Navi Mumbai.

“On this plot, we are developing 7 million square feet, mostly IT spaces and data centers with some complementary retail and non-IT offices,” Dutt said.

“The total investment in this project is Rs 5,000 crore. This is Tata Realty’s largest single investment in office real estate.

In the first phase, the company is developing a building with an area of ​​5,000 square meters (0.5 million square feet). “We are already in the market to rent out 5 square feet or more in advance. We can do whatever works for businesses. We are discussing developing data centers.

Navi Mumbai area asks for a monthly rent of 60-70 rupees per square foot. An office space of 2-3 million sq ft is rented annually in Navi Mumbai.

Tata Realty and Infrastructure Ltd, a 100 percent subsidiary of Tata Sons, has an extensive portfolio of more than 50 projects in 15 cities. The company has developed more than 15 million square feet of commercial projects and has approximately 12 million square feet of projects under development and planning. REIT, a world-renowned instrument, was introduced in India a few years ago to attract investment in the real estate sector by monetizing rental assets. It helps unlock the massive value of real estate assets and enables retail participation.

The first REIT of Rs 4,750 crore was listed in April 2019 by Embassy Office Parks, backed by Bengaluru-based Embassy Group and global investment firm Blackstone. In August last year, K Raheja supporting Mindspace Business Parks launched its second REIT in the country to raise Rs 4,500 crore. Global investment firm Brookfield launched its third REIT in the country this year to raise Rs 3,800 crore. Home Realty DLF is also working on the rental arm DLF Cyber ​​City Developers Ltd (DCCDL) REIT.

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