CapitaLand India Trust (CLINT) is in the process of acquiring an office project in Nagawara, Outer Ring Road, Bangalore, for $233.6 million. This transaction will be carried out through a forward purchase agreement with Maia Estates Offices.
According to the group, this 1.13 million sq ft office project is expected to boost earnings and distributions for unitholders. On a stabilized basis, it is projected to generate a net profit of $7.7 million, while the distribution per unit is anticipated to increase from 6.84 cents to 6.98 cents.
The office project is part of a mixed-use development that includes office and retail spaces. Under the forward purchase agreement, CLINT will fully fund the development of the office project and receive interest on the funding at a higher rate than its borrowing cost.
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Upon the completion of the development, CLINT is set to acquire the office space in the first half of 2030, while Maia will retain the retail portion. This will add 1.13 million sq ft to CLINT’s operational area in Bangalore, bringing the total to 9.9 million sq ft from the current 8.7 million sq ft.
CLINT also has other properties under development in Bangalore, including two office buildings in Gardencity, an IT park at Hebbal, and another IT park at ITPB.
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With the acquisition of this office project, CLINT’s portfolio size, including its committed investment pipeline, will increase by 4.0% from approximately 30.2 million sq ft to approximately 31.47 million sq ft.
“The acquisition of this strategically located office project will further enhance CLINT’s presence in Bangalore, one of India’s most prominent office markets. In 2024, Bangalore saw the highest ever leasing levels for Grade A office space. ORR is the largest office micro-market in Bangalore. With the addition of this prime office property, we will be able to offer our tenants a wider range of premium office space options across key micro-markets in Bangalore,” says Gauri Shankar Nagabhushanam, CEO of CLINT.
On February 21, units in CLINT closed at $1.
In related news, CapitaLand India Trust is in the process of acquiring International Tech Park Pune from its subsidiary and JV partner for $221.9 million, and has also announced its collaboration with India developer L&T Realty to develop 6 million sq ft of prime offices in India.