India is fast becoming safe investment option for institutional investors looking for putting their money in India’s rental space.
According to media reports, there is high probability that private equity organisation Kotak Realty Fund might be looking forward to buying a 700,000 sq ft IT park in Noida from ‘The 3C Company’ for a consideration of around Rs 250 crore.
If and when this happens, the deal can go a long way in adding to an already growing list of institutional investors picking up rental assets in the country. An elegant example of how amazing a real estate can be, the building, called Green Boulevard, is located in the sprawling space of Sector 62 of Noida and is home to tenants such as Accenture, Nokia Siemens and Sapient.
As per the details given on its website, Kotak Realty Fund had picked up 35% stake in the building in the year 2007 at the land allotment stage for Rs 65 crore and, it stayed invested throughout the full development life cycle of the building. It is also important to note that the building was also awarded the LEED Platinum rating in Core and Shell category by US Green Building Council (USGBC). This also shows that the standard of quality is also fast growing in the way commercial real estate buildings are being driven in India.
As the Indian reality is getting in the international sector, there are several large institutional investors which have been eyeing income-producing rental assets in India. This is primarily because these are considered to be safe investments for a secure future. It is important to note that in the month of December 2014 only, American private equity fund Blackstone has acquired a 1.5 million sq ft IT SEZ, also owned by The 3C Company, for Rs 625 crore. This trend is likely to further fuel the growth in this segment in India.