Ascendas to buyout new IT property from Phoenix in Hyderabad

Principal objective is to own income-producing real estate used primarily as business space in India

Singapore-based Ascendas Property Fund Trustee Pte Limited, a trustee-manager for Ascendas India Trust (a-iTrust) on Thursday announced that it was making investment in aVance Business Hub Property, an IT building with a total floor area of 390,000 square feet being constructed by Hyderabad-based Phoenix Infocity Private Limited.

"a-iTrust would complete the acquisition of aVance 4, upon the building's completion and satisfaction of all conditions precedent," Ascendas said in a statement on Thursday. This is the fourth IT SEZ facility, which is set to be taken over from Phoenix group as part of an arrangement entered by the two companies four years ago. The company did not reveal the value of the deal.

The principal objective of a-iTrust is to own income-producing real estate used primarily as business space in India. It's current portfolio consists of six IT business parks in India, namely the International Tech Park in Bangalore, International Tech park and CyberValve in Chennai, and CyberPearl, the V and aVance Business Hub in Hyderabad. It is structured as a business trust, offering stable income distributions similar to real estate investment trust.

Upon completion of this acquisition, a-iTrust will own 3.2 million square feet of commercial space in Hyderabad spread across the facilities, it said.

"They are the best at managing these world-class IT facilities and they also bring clients. So far we have built little over 3 million square feet of office space in IT SEZs. Ascendas acquired shares in the SPVs created for each of the three facilities upon completion as a co-developer," Srikanth Badiga, director of Phoenix group told Business Standard.