Ascendas India, a property fund Trust is soon going to purchase an office space in north Bengaluru for Rs. 750 crores. This office premises cover 1 million sq ft area and is said to be this year’s biggest commercial office deal in the India real estate market.
The company offers funding to the Singapore-based real estate group CapitaLand here in India.
Ascendas India Trust has signed a forward purchase agreement (FPA) with the Hyderabad-based Garden City Realty that owns a 7-acre plot on which the office space is planned to be developed. The company will make milestone payments and will own the office space once the complete payment is done.
According to the forward purchase deal the buyer is required to pay money in advance to the seller for purchasing a property that will be developed in the future. This advance payment is used to carry out the construction of the same property.
These deals are trending in the Indian real estate market now a day because it minimizes the risk of land acquisition, sanctions and delivery on to local partners.
In India, Ascendas India Trust already owns seven IT parks and six warehouses that cover approximately 12.6 million sq.ft. area and it is also a real estate investment trust (REIT), ranked on the Singapore stock exchange.
On the other hand, Garden City is also planning business expansion in Bengaluru as the company went into a joint development agreement with the city-based Nitesh Estates for its three residential projects in the city.