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Friday, May 24, 2024

PE Fund Mapletree acquires Bengaluru land for over Rs 1,900 crore

Adarsh Developers ↗, a real estate development ↗ firm, has sold a 41-acre land parcel ↗ in Bengaluru ↗ to the Singapore private equity fund ↗ Mapletree Investments.

The deal is valued at over Rs 1900 crore and is part of Adarsh Developers’ debt reduction ↗ strategy. The land has a development potential of around 7 million square feet.

“It is a greenfield development ↗, and the money will be used to reduce debt. Adarsh Developers have been consistently reducing debt and focusing on growth,” said two persons aware of the development.

Adarsh Developers, Mapletree ↗ and Savills India, advisor to the deal, declined to comment on the deal.

Adarsh sold land to raise cash from private equity funds as it embarks on the next growth phase ↗. The firm has successfully refinanced a debt exceeding Rs 3,000 crore in the last two years.

“The builder is looking to reduce the net debt ↗ by another Rs 1000 crore, and this is the last land monetisation undertaken by Adarsh,” said one of the persons quoted above. The firm’s net debt stood at Rs 3300 crore as of March 2024.

In addition to these developments, Adarsh Developers sold two of its land parcels in Bengaluru to Godrej Properties ↗ for approximately Rs 180 crore in 2022. The company strongly focuses on luxury homes with prices exceeding Rs 1.4 crore in Bengaluru, and 20% of its portfolio is dedicated to projects targeting the mid-income group.

In 2023, HDFC Capital Advisors ↗, a subsidiary of India’s largest private mortgage lender, HDFC, invested over Rs 1,600 crore in a portfolio comprising 12-13 residential projects developed by Adarsh Developers. These projects are located exclusively in Bengaluru and cover a total area of 10 million square feet. The portfolio includes both ongoing and approved projects. Adarsh Developers has also secured capital from Oaktree and Edelweiss to replace old debt and to support growth.

“The capital infusion has multiple objectives, such as fostering expansion, guaranteeing operational funds, and expediting the conclusion of current projects,” said a source.

The company is set to allocate approximately Rs 7000 crore over the next seven years to develop 25 mn sq ft of residential properties in Bengaluru, along with a venture into plotted development. This encompasses ongoing apartment projects covering 17.10 million square feet, plotted developments spanning 2.80 million square feet, and Villa developments totalling 4.62 million square feet.

Headquartered in Singapore, Mapletree is a global real estate development, investment, capital, and property management company committed to sustainability. It is selectively looking to add rental yield assets to its portfolio. The firm has deployed capital across major cities like Bengaluru, Pune, and Mumbai.

The Group manages three Singapore-listed real estate investment trusts (“REITs”) and eight private equity real estate funds, which hold a diverse portfolio of assets in 13 markets across Asia Pacific, Europe, the United Kingdom (UK) and the United States. As of March 31, 2023, Mapletree owns and manages S$77.4 billion of office, retail, logistics, industrial, data centre, residential and student accommodation properties.

Michael Maren
Michael Maren
Former marine biologist who likes to spend as much time in the tropics as possible, due to a horrible time I once had in Alaska. Brrrr.

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