Blackstone closing in on its first realty deal in India

Blackstone, the global private equity giant based in the US which has a corpus of $9.5 billion, is understood to be closing in on its first real estate deal in India. The private equity fund, present in India with its real estate team for the past three years, is understood to be in discussions with Bangalore-based Embassy Property Development to invest around Rs 200 crore in one of its projects.

Embassy Property Development is understood to be raising private equity even as it is awaiting Securities & Exchange Board of India (SEBI) clearance for a planned public offer of Rs 2,400 crore which is expected during this calendar. The issue is expected to be managed by investment banks UBS, Citigroup, Nomura and Edelweiss.

While Blackstone could not be reached for comments, Embassy denied any such plans of raising funds from Blackstone. According to recent reports, Embassy was also in talks with Temasek and HDFC Property Ventures for a $100 million private equity infusion, the status of which is not yet clear.

Embassy has so far developed close to 25 million square feet with a high degree of focus on business parks. Of the Rs 2,400 crore planned public issue, Embassy plans to use around Rs 803 crore to invest in ongoing projects, Rs 685 crore in various subsidiaries and around Rs 123 crore pay loans (including loans of subsidiaries).

While Blackstone is expected to do a full-blooded real estate deal in the near future, the PE fund during 2008 had taken an exposure of $18 million in Bangalore-based construction-management company — Synergy Property Development Services. Synergy focuses on architectural design and complete project management.

Some of its major projects have included Medicity in Gurgaon, Select Citywalk, a retail development in Delhi; and the Park Hyatt hotel in Chennai.