Financial Daily from THE HINDU group of publications
Thursday, Apr 20, 2006
Financial Daily from THE HINDU group of publications Thursday, Apr 20, 2006 |
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Marketing
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Retailing Industry & Economy - Real Estate & Construction CapitaLand Retail to invest $75 m in global realty fund Our Bureau
Mumbai , April 19 CapitaLand Retail India, a joint venture between Pantaloon Retail and CapitaLand, has announced plans to invest $75 million in an international realty fund, Horizon Realty Fund. Horizon Realty Fund is managed by Kshitij Investment Advisory, the asset management arm of Pantaloon Retail India. CapitaLand, one of Asia's largest property group, has also signed an agreement with Pantaloon to form a 50:50 joint venture retail management company and a 50:50 joint venture fund management company. The joint-venture fund management company intends to create a development fund, a retail income fund (REITs) to capture the growth in the Indian retail real estate market. For such funds CapitaLand would invest 20 - 40 per cent as a sponsor. The retail management company would offer services to retail properties owned or leased by Pantaloon, properties owned by the Horizon Fund and properties owned by other retail property funds or Real Estate Investment Trusts (REITs), which may be jointly created by CapitaLand and Pantaloon. This company would reportedly manage a portfolio of over 50 quality retail malls located in metros, mini metros and tier two towns in India within the next two to three years, a news release said. The Horizon Fund will be Kshitij Investment Advisory's second real estate fund following the deployment of a domestic Indian Rupee fund (The Kshitij Fund: Corpus $80 million). The Horizon Fund has an initial target fund size of $250 million, with an estimated final closing of $350 million. This fund will invest in predominantly retail real estate development assets in India. The Horizon Fund has already identified four potential investments in Mumbai, Chennai, Bangalore and Kolkata with an approximate total retail GFA (gross floor area) of 4.1 million sq. ft. and an estimated total project cost of $330 million. These properties are targeted to be completed by 2008-2009. "Together, we envisage managing within the next two to three years this portfolio of assets, across approximately 19 million sq.ft. of retail real estate pan-India and also creating retail property funds or REITs. Through this alliance, we intend to maintain our leadership position in India's fast growing retail real estate market," the release said quoting Mr Kishore Biyani, Managing Director, Pantaloon Retail (India). Shares of Pantaloon Retail fell by Rs 35 to Rs 1932.05 in Wednesday's trade on BSE.
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