Global insurance and asset management major the Allianz Group has partnered with Shapoorji Pallonji Group to establish SPREF II, a Singapore-domiciled, Rupee denominated, closed-ended fund targeting the office market in India. The fund is aiming to raise $500 million in equity.
This is Allianz’s first real estate transaction in India and was conducted by Allianz Real Estate, the real estate investment and asset manager within the Allianz Group, on behalf of several Allianz companies.
This deal forms part of Allianz’s strategy to allocate around 5% of its global real estate portfolio to the Asia Pacific region, Allianz said in a release.
Allianz will own 50% of the platform, and the remaining will be held by other long-term institutional investors.
“India is strategic to the Allianz Group. In growth economies like China and India, real estate provides a scalable entry into the market for Allianz in terms of investments/asset management exposure,” said Francois Trausch, Global CEO of Allianz Real Estate.
The proposed platform’s strategy will focus on top six tier-I Indian cities to build a long term, cash flow producing office portfolio by acquiring a mix of develop-to-core, forward purchases, and stabilized or stabilizing assets. The six target cities will be Mumbai, Bangalore, Hyderabad, Pune, Chennai, and National Capital Region.
“We are looking to deploy approximately 60% of our Asia-Pacific allocation to growth economies. The Indian economy has been consistently outperforming. Strong secular growth, stellar demographic trends, and improving transparency are supporting stable real estate occupiers as well as investor demand, in particular the office sector which is ideal for long-term core investors like Allianz,” said Rushabh Desai, Asia-Pacific CEO of Allianz Real Estate.
The venture will be supported locally by the Shapoorji Pallonji Investment Advisors team led by Rajesh Agarwal.
“We view this partnership with Allianz as the first step in a relationship which will focus on creating long term value for the investors,” said Shapoor Mistry, Chairman, Shapoorji Pallonji Group.
Source: Economic Times