The investment is the second tranche under the strategic partnership between
and India’s largest retail-led mixed-use asset developer and operator, to establish a joint venture to develop, own and operate retail-led, mixed-use developments across India.
Last year, GIC had acquired an equity stake of about 26.44% in marvel Selective portfolio of Mills of Rs 5,500 crore by investing a total amount of Rs 1,111 crore. With this investment, the Singapore government entity’s stake in each of these subsidiaries has increased to 32.90%, while Phoenix Mills holds the remaining 67.10%.
GIC has invested in these subsidiaries indirectly through its wholly owned entity Reco Zinnia Pvt Ltd (RZPL). Phoenix Mills’ subsidiaries, Offbeat Developers Pvt Ltd (ODPL), Graceworks Realty & Leisure Pvt Ltd (GRLPL) and Vamona Developers Pvt Ltd (VDPL), have received equity investments of Rs 219 crore, Rs 149 crore and Rs 31 crore respectively .
The portfolio of the deal includes a retail-led mixed-use development of 3.7 million square feet, including offices located in key consumption centers in Mumbai and Pune. It consists of two major malls- Phoenix Market City in Mumbai, Kurla and Phoenix Market City, Pune as well as three commercial properties in Mumbai.
Of the total 3.7 million sq ft development portfolio, approximately 2.3 million sq ft are retail properties and 1.4 million sq ft are office properties.
These are currently among Phoenix’s most prominent and well-performing operating assets. The total investment has been made through a combination of primary investment and secondary purchase of equity shares.
GIC and Phoenix may consider various options to monetize this platform, including a real estate investment trust (REIT), in three-five years from the conclusion of this transaction, the latter said earlier.
The primary proceeds from the transaction are to be used by Phoenix subsidiaries as growth capital for the expansion and acquisition of greenfield, brownfield, operational and/or distressed mall opportunities. The secondary income will help Phoenix create a safety net in the near term, fund various under-construction projects and act as a battle chest for further acquisitions in the medium term.
The investment indicates the continued interest of global investors in the growth of Indian malls and the belief that retail consumption will resume once the COVID-19 pandemic ends.
Last year, the Canada Pension Plan Investment Board (CPPIB) also expanded its partnership with Phoenix Mills to invest up to Rs 800 crore in their existing joint venture to develop retail and office properties.
Hit by the disruption caused by the Covid19 pandemic over the past two years, retail consumption has bounced back, making steady progress in recovery, which continues to focus on its plans to develop more malls in India’s major cities. Backing up the trust of developers.
Phoenix Mills is operating four new large malls in key consumption centers of Pune, Bangalore, Ahmedabad and Indore over the next 12-15 months due to a strong rebound in retail activity driven by slowdown in demand and badla shopping. Is. Epidemic.