Realty giant Runwal Group and private equity major Warburg Pincus are all set to enter into the largest real estate transaction deal of the year to develop $1 billion retail-led mixed-use development across the country. The information has been revealed by sources of both the group recently.
According to the sources, the joint platform will see both the entities infusing around $250 million each as their equity contribution, while the rest will be through leveraging.
Source from one of the company said, “This ($500 million) would just be the initial contribution as both the entities are open to investing more and expanding the size of the investment platform. Further investments and upping the platform size would depend on future growth opportunities,”
They further said that both Warburg and Runwal are planning to develop a portfolio of 15-20 retail-led properties in tier-I and II Indian cities over the next five years, under the joint platform. Apart from the new developments, the two will also acquire operational and partially-completed projects.
“A new team will be formed to manage the efforts of this proposed platform that will build, own and operate retail-driven properties,” Source added.
As a part of this venture, Warburg will start with acquiring stake in Runwal’s few operational properties and partial projects like 0.5-million-sq-ft R-Mall in Thane. Runwal’s proposed mixed-use development on 8-10 acre in Dombivli near Mumbai will also become a part of this venture.
The JV will develop nearly 1 million sqft retail project of 20 acre development in Pune. They will also be developing a proposed construction on a 3-acre land parcel in Mumbai’s western suburb Andheri. This includes the development of 7 lakh sqft office space and 3.5 lakh sqft retail space.