V Rishi Kumar

Ascendas Property Fund Trustee Pte Ltd., the Trustee-Manager of Ascendas India Trust has entered into a forward purchase agreement with Phoenix Infocity to acquire the latter’s several assets.

The acquisition will not only cover two buildings, aVance 5 & 6, with a combined leasable area of 1.8 million sq ft, in aVance Business Hub, located in Hitec City in Hyderabad, a separate arrangement with the Vendor enables Ascendas arm to acquire five additional buildings in aVance Business Hub 2, a Special Economic Zone adjacent to aVance Business Hub.

aVance Business Hub comprises 10 buildings with total leasable area of 4.6 million sq ft; of which nine buildings with 3.4 million sq ft have been completed and leased to leading IT companies the likes of HCL, Cognizant, IBM and Amazon.

To date, a-iTrust has acquired four buildings aggregating 1.5 million sq ft. The Trust also has a right of first refusal to acquire four other buildings totaling 1.2 million square feet.

a-iTrust has now entered into a forward purchase agreement to acquire the remaining two buildings (aVance 5 & 6) in aVance Business Hub.

In addition, Phoenix has plans to develop aVance Business Hub 2, which sits on 14.4 acres of land. It comprises seven buildings to be developed over five to nine years. a-iTrust has entered into a separate agreement with the Vendor to acquire five out of the seven future buildings.

These five buildings will be acquired individually when completed, subject to required leasing levels being met, amongst other conditions.

Sanjeev Dasgupta, Chief Executive Officer of the Trustee-Manager in a statement said, “The proposed acquisition of aVance 5 & 6 will allow us to deepen our presence in Hyderabad, which is currently witnessing robust rental growth arising from healthy demand from global IT companies.”

“The Trust portfolio will increase to 16 million square feet once we complete the acquisition of Aurum IT SEZ and aVance 5 & 6. The opportunity to acquire an additional five buildings in future will allow the Trust to enjoy even greater economies of scale in Hyderabad, and further strengthen its competitiveness in the market,” he said.

a-iTrust along with its affiliates will provide construction funding via inter-corporate deposits and debentures issued by the master developer amounting to ₹887.4 crore.

The acquisition will be completed by buying 100 per cent of the shares in the master developer once the property achieves 90 per cent leasing. The total purchase consideration, inclusive of the construction funding, is not expected to exceed ₹1,350 crore.

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