Realty developer Tata Realty & Infrastructure Ltd (TRIL) has bought out the entire equity stake held by global investor Actis’ affiliate Actis TREIT Holdings No. 2 (Singapore) in its commercial project Intellion Square in Goregaon suburb of Mumbai in an all-cash deal.
In addition to equity stake, the developer has also acquired 416 listed non-convertible debentures (NCDs) held by Actis TREIT Holdings No. 1 (Singapore) in the project that was earlier known as TRIL IT4.
“The deal for the 26% equity stake has pushed the project’s valuation to around Rs 1,200 crore,” said one of the persons with direct knowledge of the development.
The project was part of a joint venture between Tata Realty and Actis that invests in and develops new generation offices in established commercial markets across India’s major cities.
“We remain steadfast in our commitment to strengthen our commercial portfolio. This transaction is a testament to our confidence in the Indian commercial real estate sector. This deal is in line with our endeavour and expansion strategy for our commercial portfolio,” said Sanjay Dutt, MD & CEO, TRIL. He declined to comment on the size and valuation of the deal.
Following this transaction, TRIL now owns 100% stake in the project, which owns and operates an information technology (IT) building, located in the micro market of Mumbai’s Malad suburb. It is an 0.8 million sq ft completed building leased to tenants, largely from the technology and banking, financial services and insurance (BFSI) sectors.
“Actis’ joint venture with Tata Realty has delivered its first successful exit at a time of significant short-term disruption but where strong long-term fundamentals in the Indian office market still exist. With the right partner quality and strategy in the mix, supported by our active asset management approach, we look forward to further successes in our joint venture,” said Ashish Singh, Partner in the Asia Real Estate team at Actis.
The transaction is the second office exit by Actis during the Covid-19 pandemic, after another exit it had completed last year during the peak of the pandemic in Seoul, Korea.
Both the exits have delivered robust returns and enforce Actis’ strategy of working with high quality partners, in bringing new generation office assets at competitive prices to its markets.
“TRIL & Actis have a long-standing platform level partnership with investments across multiple assets and it has been a mutually enriching experience. With this successful exit, TRIL has demonstrated its capability to create shareholder value for pre-eminent investor partners,” Dutt added.
During a period of five years, Actis actively supplemented Tata Realty’s efforts in carrying out a programme of substantial asset upgrade works and efficiency-based pricing to enhance the asset’s appeal ahead of major lease renewals and to increase its net income.
Over the last one year, Tata Realty has invested around Rs 15 crore to upgrade the building to make it more tenant-friendly.
Despite the impact of the Covid-19 pandemic, Intellion Square remains an attractive Grade A office space that has seen not only new tenants making long term commitments to the property, but also existing tenants extending their leases, with a healthy and stable occupancy at around 90%.
