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Prozone enters race to buy malls in Mumbai, Delhi, Pune, other big cities

It owns malls in Aurangabad and Coimbatore, and is building a 500,000-sq ft one in Nagpur

Raghavendra Kamath  |  Mumbai 

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Intu Properties has joined the race to buy in India’s prominent cities. It is a joint venture (JV) between Mumbai-based mall developer and UK’s Intu Properties.

Global private equity majors such as Blackstone, Xander-APG, Singapore’s GIC sovereign fund and the Phoenix Mills-CPPIB alliance have invested in and are aggressive on plans to buy more.

BSE-listed Intu is planning to buy in Mumbai, Delhi, Pune and other major cities. “We have already finalised a few deals in Mumbai,” said Nikhil Chaturvedi, managing director.

The firm owns in Aurangabad and Coimbatore, and is building a 500,000-sq. ft one in Nagpur, Chaturvedi said.

The mall in Coimbatore is on 500,000 sq. ft and the one in Aurangabad, Maharashtra, has an area of 600,000 sq. ft. says it is not worried about competition from the likes of Blackstone, which already has a couple of Several are still up for grabs, said Chaturvedi. “We are ready to partner with mall owners. We have enough capital to deploy,” he said, adding that they were looking to buy in the range of 400,000 to 500,000 sq. ft.

Blackstone acquired eight in the past two years and has a portfolio of over 5 million sq. ft. It is planning to take that to 7 million sq. ft. It has a set up a separate company, Nexus to operate these.

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Private Equity firm Xander has formed a JV with Dutch Pension fund APG, and formed Virtuous Retail South Asia, that acquired a mall in Chandigarh last year.

The JV owns properties in Surat and Bengaluru, among other places.

Phoenix Mills, currently the largest among mall owners in India, has a strong portfolio, in this regard, with 6 million sq. ft.

It has tied up with Canada’s CPPIB to acquire more properties. Shobhit Agarwal, managing director at ANB Capital Advisors, said while the country had a decent number of retail malls, not all were performing well.

As a result, quality retail have been gaining across the country for some quarters.

“Unlike office spaces, investors are not restricting themselves to the top seven to eight cities. With the economy showing signs of improvement, disposable income has started finding its way into branded goods, leading to better-performing retail Also, expectations from mall owners, especially in tier-II and tier-III cities, are still not very high, allowing good entry points to investors,” he said.

According to real estate consultancy JLL, the year 2017 saw withdrawal of nearly 5 million sq. ft of retail space with the closing of

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This mostly happened in NCR region and as these markets have significant stock and a considerable percentage were performing below average, it said.

Retail properties saw PE investment of about $750 million in the 2017, almost double the figure in 2016.

First Published: Thu, April 05 2018. 06:32 IST
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