20/06/2014
Indian commercial real estate turnaround
Blackstone Group Lp, the world’s largest real estate investor, is leading a wave of investors in Indian commercial property as rents at three-year lows and Asia’s worst-performing currency lured global companies. The company has invested $1 billion in commercial real estate across India to become the largest landlord in the country among private-equity investors
Xander Group, with about $2 billion of equity capital in property assets, and a consortium led by Dutch pension fund asset manager APG announced a $300 million venture in May that will buy commercial assets across India’s main office markets.
Among others, GIC Pte, Singapore’s sovereign wealth fund, and Ascendas Pte, a Singapore-based business-park developer, plan to invest as much as 600 million Singapore dollars ($480 million) in Indian commercial property to meet rising demand, they said in November.
Large office parks, where buildings are grouped together, are what makes India commercial sector attractive. Demand for space in these parks tends to increase when Western economies, like in the US and Europe now, recover, prompting companies to boost their global support functions.
With Modi at the helm of the new government, there is optimism he will help jump-start the economy. Morgan Stanley, Citigroup Inc. and Nomura Holdings Inc. are forecasting faster expansion in the next few years on Modi’s plans to attract investment and build more ports, roads and bridges. Morgan Stanley raised the country’s gross domestic product estimate to a four-year high of 6.5% in the year through March 2016 from 6.2%.
