Blackstone invests $70m in Salarpuria’s realty project in Hyderabad

Blackstone Group Lp has invested Rs.470 crore in an ongoing office park project in Hyderabad’s Knowledge City, marking the global private equity fund’s first investment in the city, said two people familiar with the development, who did not want to be named.

Bengaluru-based real estate firm Salarpuria Sattva Goup has raised the capital from Blackstone to fund its project at Knowledge City, where it is building 6.5 million sq. ft of office space that is partly leased. The project is expected to be completed in 4-5 years.

The investment is pegged to boost investor interest in the property market of Hyderabad, at a time when the city is inching back to normalcy after prolonged political unrest.

Bijay Agarwal, managing director, Salarpuria Sattva Group, confirmed the transaction but did not give more details.

Blackstone declined to comment, citing company policy.

Salarpuria Sattva has a large residential and commercial office portfolio of projects in Bengaluru, Hyderabad, Coimbatore, Pune and Goa. Last year, it bought a 20-acre property in Hyderabad’s Tolichowki area from Bayer Bioscience Pvt. Ltd.

The office space sector saw steady growth in 2015 amid a prolonged slowdown in India’s residential space due to tepid demand, rise in prices and unsold inventory. Private equity funds and property developers bought office space at a brisk pace with plans to build new information technology parks and special economic zones, in sharp contrast to the freeze on residential project launches.

Investments made by Blackstone in 2015 include buying Oxygen, a special economic zone in the National Capital Region, from 3C Company for around Rs.620 crore and a commercial office project in suburban Mumbai for Rs.1,060 crore from HCC Real Estate Ltd and IL&FS Milestone Realty Advisors Pvt. Ltd.

Hyderabad, since 2009, has suffered from a prolonged economic slowdown and political unrest, leading to the formation of Telangana, which was carved out of Andhra Pradesh on 2 June 2014. The uncertainty ended when Hyderabad was named the joint capital of Telangana and Andhra Pradesh till 2024, after which the city will be completely transferred to Telangana.

Green shoots of a recovery in Hyderabad real estate market are already visible with property reports indicating better residential sales as well as good office leasing momentum.

“With the uncertainty over, both investor interest and trust are returning to Hyderabad. For a market that was depressed for a long time, it is clearly showing signs of a turnaround,” said Shashank Jain, partner, transaction services, PricewaterhouseCoopers India.

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This story was first published on livemint.com

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.