Lodha, Bain, Ivanhoe Ink $1bn Logistics Deal

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Real estate firm Lodha on Wednesday said it has partnered with Bain Capital and Ivanhoé Cambridge to build a platform of logistics and light industrial parks, as well as in-city fulfillment centers.

The platform will jointly invest $1 billion to create about 30 million sq ft of operating assets to serve the country’s digital economy. Each of the three partners will have a 33% equity interest in the property ownership, while Lodha will lead the development, operations and management of the assets.

“With the rapid digitization of our economy and the progress of ‘Make in India’ combined with the China + 1 strategy of most global manufacturers, we see that there is a huge demand for Grade-A digital infrastructure in our country. Following the government’s focus on improving logistics efficiency and creating jobs in different parts of the country, the platform will plan the development of industrial and logistics parks as well in-city fulfillment centers across multiple cities in India,” said Abhishek Lodha, MD and CEO, Lodha.

“We’re delighted to expand our partnership with 2 marquee global investors – lvanhoé Cambridge and Bain Capital, who bring extensive experience in this asset class and dedicated resources to support the growth of this platform,” Lodha added.

The first project is a 110-acre logistics and industrial park development at Palava, in Mumbai. The platform has also started looking at pan-India acquisitions of land and developed or under-development projects in these asset classes.

“This is an exciting partnership that brings together an experienced real estate developer with deep digital infrastructure capabilities with the complementary support of global investors with long track records of success in commercial real estate,” said Ali Haroon, a managing director at investment firm Bain Capital. “We see a sustained, thematic opportunity to support India’s journey to a digital-first economy with high-quality infrastructure which we believe can have a very positive impact on communities, consumers and businesses throughout the country.

Real estate is a core focus of Bain Capital Asia’s Special Situation business and this transaction follows the firm’s approach to building value-added partnerships with skilled local developers.

“This partnership opens up new perspectives for expansion of our logistics portfolio in India, a high conviction thesis well supported by strong sector fundamentals as India enters a digital super cycle,” said Chanakya Chakravarti, vice-president and MD, India, at lvanhoé Cambridgem a subsidiary of Caisse de dépdt et placement du Québec (CDPQ), a global investment group.

“We believe the Indian logistics ecosystem continues to offer opportunities driven by positive trends in urbanization, domestic consumption, new impetus to the light manufacturing sector, modernizing multi-modal infrastructure and the rapidly evolving e-commerce sector, which remains largely underpenetrated, compared to other major economies globally. We look forward to expanding our logistics footprint by leveraging Lodha’s proprietary in-city sites, access to land pads in key warehousing nodes and their execution capabilities. The new partnership potentially enables lvanhoé Cambridge access to near city logistics opportunities as operators pivot to establish same day delivery solutions thus creating differentiated value in our portfolio construct and its scale”, he added.

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