DLF rental arm to buy Hines stake in commercial project in Gurgaon

Realty major DLF's rental arm DCCDL has entered into an agreement to acquire the stake of US-based Hines in a premium commercial project in Gurugram for Rs 780 crore, the company said in a regulatory filing.

DLF Cyber City Developers Ltd (DCCDL), the joint venture firm of DLF and Singapore's sovereign wealth fund GIC, has entered into a securities purchase agreement with funds managed by Hines for acquisition of their stake in Fairleaf Real Estate, which owns and operates 'One Horizon Center'.

"The purchase consideration for this acquisition is approximately Rs 780 crore, subject to customary closing adjustments," the company said in a late night filing on Friday.

Hines has around nearly 52 per cent stake in the One Horizon Centre while the rest is with DCCDL. DCCDL has the first right of refusal with respect to acquiring Hines' stake.

The commercial tower One Horizon Center has leasable area of about 8,13,000 square feet offering high-end Grade A office spaces along with complementary retail space.

The acquisition is subject to customary conditions to closure and is expected to be consummated in the next quarter.

Sriram Khattar, MD-Rental Business, DLF, said the company has acquired complete ownership of this asset.

"This acquisition adds another trophy asset to our strong rental platform. We believe that this acquisition will be highly value accretive for us and will add approximately Rs 150-160 crore of rental revenues annually," Khattar said.

Post acquisition, the DCCDL platform will have about 34 million sq ft of operational rental portfolio.

In December 2017, DLF entered into this joint venture with GIC when DLF promoters sold their entire 40 per cent stake in DCCDL for nearlyRs 12,000 crore.

This deal included sale of 33.34 per cent stake in the DCCDL to GIC for aboutRs 9,000 crore and buyback of remaining shares worth aboutRs 3,000 crore by DCCDL.

DLF holds 66.66 per cent stake in DCCDL while GIC has the rest.

DCCDL had reported a 15 per cent rise in its rental income last fiscal at Rs 3,006 crore on strong demand for quality office and retail spaces.