 "PE player Blackstone acquires Serco's India BPO unit")
Blackstone, largest alternative assets manager in the world, is is exploring options to separately list its mall properties in the country as a real estate investment trust (Reit), said a source in the know.
Blackstone owns three malls in the country, with a total area of two million sq ft. It wishes to buy more, said the source, who did not want to be named. An expert says its current mall portfolio would get a valuation of Rs 1,800 crore.
"Blackstone is studying the options and will take a call on that in the coming months," the source said. "The return on investments and investor class is different for office and retail assets."
In April, Blackstone bought a million sq ft project, including a mall, being developed by L&T Realty in the Seawoods area of Navi Mumbai, for around Rs 1,400 crore in one of the biggest commercial property deals this year. Last year, it bought two malls of the Alpha G Corp in Amritsar and Ahmedabad, totalling 1.2 mn sq ft, for Rs 800 crore.
Asked, a Blackstone spokesperson said: "As a matter of policy, Blackstone does not comment on market speculation."
"Most of the commercial properties are in separate SPVs (SPecial Purpose Vehicles) and the shareholding pattern of each company differs. Further, bringing different properties in one company would attract stamp duty, whose financial impact will be sizable. As long as it meets the Sebi (the capital markets regulator) guidelines on listing, developers or funds will keep each listing separate," said Ajay Jain, executive director, investment banking and head-real estate group, at Centrum Capital.
Blackstone is also setting up a separate team for managing retail assets, headed by Vikram Garg, earlier a director with Religare Enterprises. Recently, it hired Nirzar Jain from Oberoi Realty in a senior position.
"They're also setting up a separate office at Vashi in Navi Mumbai, while their main office is in Express Towers at Nariman Point in Mumbai," said the source.
Globally, Blackstone has $101 billion of assets in real estate and owns 180 mn sq ft of retail assets, making it one of the largest owners of such properties. It owns Multi Corp in Europe, which owns or manages 161 shopping centres, factory outlets and retail parks in 13 countries there.
Through its investment in SCP Group, the largest non-family controlled mall company in China, Blackstone controls a portfolio of 21 mass-market malls across 17 first and second-tier Chinese cities.
As reported earlier here, Blackstone has already begun discussion with partners and its bankers on consolidating its office properties in this country, with the idea of a Reit, say sources. Blackstone and its partners, the Bengaluru-based Embassy and Pune-based Panchshil, own about 35 mn sq ft of office properties, valued at Rs 24,500 crore ($3.65 billion), said a source. Adding "It could be a $2-3 bn issue (Rs 13,500 to Rs 20,000 crore)."
If the Reit comes out, it would beat the initial public offering size of DLF, the country's largest property developer. That had raised Rs 9,180 crore in 2007
Last Friday, the Securities and Exchange Board of India (Sebi) proposed relaxation of norms for launching of Reits. The Sebi board approved removal of restrictions on a Special Purpose Vehicle (SPV) to invest in other SPVs holding assets. It also allowed a Reit to invest up to 20 per cent in under-construction projects, while easing the criteria for related-party transactions and allowing more sponsors in such a Trust.
BLACKSTONE'S INDIA RETAIL BET
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Blackstone owns three malls with 2 mn sq ft and looking to buy more malls here
