GIC to acquire Shriram Properties’ IT-SEZ project for Rs 850 crore

If sources are to be believed, Singapore based wealth fund specialist GIC is looking forward to acquire Bengaluru based Shriram Properties’ IT-SEZ project worth Rs 850 crore in coming times. Shriram Properties is a real estate developer which has developed various commercial, residential, SEZ, IT parks and other projects on a large scale.
This Special Economic Zone is spread over 58 acres of land out of which 40 acres is covered with IT offices and rest 18 acres are allocated for residential development. This SEZ is a part of Chennai based ‘The Gateway SEZ’, which is a joint venture of Shriram Properties and SUN-Apollo Real Estate Fund with equal shares and responsibilities. Latter is joint ventures of SUN group and AREA Property Partners.
Meanwhile, the residential part of the development has also seen new investment. It is learnt that HDFC Property Fund has put in Rs 310 crore and with that SUN-Apollo has exited the project. SUN-Apollo had invested across commercial and residential parts of the development.
“The investor has made close to 2X on its investment from the exit from residential segment of the project,” said a person who did not wish to be named.
The developer has been out in the market to sell the asset for a long time now. The project had earlier elicited interest from Xander Advisors and Singapore-headquartered Ascendas, which specialises in technology parks.
The development comes amid Shriram’s plans to float its IPO by next year. It raised funding of Rs 480 crore at entity level (holding company) from Tata Opportunities Fund last year and recently raised Rs 80 crore for its ongoing project Greenfield from Motilal Oswal.
As for GIC, this will mark its fifth investment in the last three-four months if the deal goes through. The investor has been consistently increasing its exposure to Indian real estate market across the residential and commercial space.
The outlook for commercial real estate is positive for 2015 as leasing activity is expected to pick up on the back of improved macro activities. According to Cushman and Wakefield, total office absorption stood at around 8 million sq ft in the first quarter of 2015, up by 35 per cent year on year, with Chennai and Bangalore being the top performers driven by IT and ITeS.