Godrej Fund Management has acquired stake in an upcoming commercial office project in Bengaluru, which is being developed by Century Real Estate Holdings Pvt Ltd, for around ₹850 crore, said two people familiar with the development.
The 2.5 million sq ft project in the Hebbal micro-market in the north part of the city is expected to be ready in another three years.
The investment has been made from Godrej Fund Management’s $450 million office investment and development platform. The fund, Godrej Build to Core-1, received commitments of around $150 million from Allianz Real Estate and another $150 million from Dutch investor APF Asset Management.
“Godrej Fund Management gets around 35% of built-up area in the project against its stake acquisition. The capital will be used for constructing the project,” said the first person, requesting not to be named.
Century, which owns a considerably large land bank in Bengaluru, has a residential development portfolio, and now plans to also build commercial office projects.
It has a project development pipeline of around 7 million sq ft over the next 4-5 years. Among the projects planned, is a prime office development on St Mark’s Road, in central Bengaluru, which Century is developing with real estate firm Vaswani Group.
The commercial office market has outperformed the residential sector in the country, and attracted high institutional investor interest. Rentals have risen, there is robust demand for good quality office space and India’s first real estate investment trust (REIT) was launched by Embassy Office Parks earlier this year.
This article was first published on livemint.com