After selling a 50 per cent stake in Mumbai and Gurugram commercial properties to US-based fund manager Blackstone one and a half years ago, Indiabulls Real Estate sold the remaining stake to the former for Rs 2,717 crore.
In March last year, Indiabulls sold 50 per cent in the same Mumbai properties to Blackstone for Rs 4,750 crore at an enterprise valuation of Rs 9,500 crore. Indiabulls said the equity value in the deal was Rs 2,250 crore and the rest was the transfer of debt.
According to sources, it is Indiabulls larger plans to exit real estate before its proposed merger with Laxmi Vilas Bank. In June, Embassy Property Developments bought 14 per cent of the promoters’ stake in Indiabulls Real Estate. Embassy has not yet bought the remaining promoters stake in the firm as planned earlier.
The acquisition of stake would give Blackstone complete control and ownership in Indiabulls commercial office portfolio of 5 million square feet. Indiabulls sold 50 per cent in Gurugram properties to Blackstone for an enterprise valuation of Rs 464 crore. Later it bought Indiabulls’ office park in Chennai for Rs 900 crore.
According to sources, Blackstone could put the assets in the listed real estate investment trust (REIT). However, it could not be independently verified.
Indiabulls and its subsidiaries are also in the process of finalising a deal with Blackstone to divest direct or indirect stake in commercial assets at Worli Mumbai, rights or stake in K G Marg, New Delhi and Sector 104 & Sector 106, Gurugram, the company said. “This has generated significant financial resources for the company towards achieving its goal of zero net debt in current financial year,” the company said. Indiabulls Real Estate had total debt of Rs 4,590 crore in FY19.
The deal is expected to help Blackstone consolidate its position as the largest commercial property landlord in the country and owns over 70 million square feet of commercial properties. It has invested over $6 billion in the commercial properties in the country.
It, along with its partner Embassy group, floated the country’s first real estate investment trust or REIT in the country and raised Rs 4,750 crore. It has a portfolio of 33 million square feet in Mumbai, Bengaluru and so on. Two of Blackstone’s other partners such as Mumbai-based K Raheja Corp and Bengaluru-based Salarpuria Sattva are also gearing up to float REITs in the country.
The story so far
- In March 2018, Indiabulls sold 50% stake in Mumbai properties to Blackstone for Rs 2,250 crore
- In 2018, Indiabulls sold 50% stake in Gurugram properties to Blackstone for an enterprise value of Rs 464 crore
- It is part of Indiabulls’ larger plan to exit the realty business before the proposed merger with Laxmi Vilas Bank
- In June, Embassy bought 14% of promoters’ stake in Indiabulls Real Estate
- Blackstone also bought Indiabulls’ office park in Chennai for Rs 900 crore
- Blackstone could put the assets in the listed REIT of Embassy Office Parks
Blackstone owns over 70 million sq ft of commercial properties and invested $6 bn