Alibaba-backed Paytm has sealed one of the biggest real estate deals in the e-commerce sector. The Vijay Shekhar Sharma-led One97, which owns Paytm, has secured three new office premises on lease in Noida, in the National Capital Region (NCR). The 350,000 sq ft spread will come for an estimated Rs 12 crore a month, or Rs 144 crore a year.
Paytm already has an office in this region and the new premises are in line with the company's plan to hire 4,500 people through the next few months. The aggressive hiring is part of the company's plan to increase its gross merchandise value by four times to about $4 billion this year.
The new office premises are expected to be delivered in the next two months.
When contacted, a company spokesperson confirmed the development. "We are hiring aggressively and 4,000-4,500 people will be joining us in next 6-12 months. The new buildings and seatings are in alignment with this hiring," the spokesperson said.
Sources say the lease rate for the deal is Rs 30-35/sq ft. The company did not comment on the rate.
While e-commerce companies in India have been making headlines with fundraising deals and soaring valuations, increasing prime office space absorption across areas such as Delhi-NCR, Bengaluru and Hyderabad has become a focus area for these companies, as they scale up business.
According to reports, American e-tail giant Amazon is close to adding 1.3 million sq ft of capacity in Bengaluru with IT park developer Bagmane. Last year, e-commerce giant Flipkart had topped the list among e-commerce players by securing three office properties, totalling 411,000 sq ft, on Bengaluru's Outer Ring Road, according to data available with Cushman & Wakefield, a leading international consultancy. The Bengaluru-based firm is also expected to close another real estate deal for a campus in that city, which is likely to be spread over three million sq ft.
Paytm, which has received minority funding from Ratan Tata, chairman Emeritus of Tata Sons, has been accelerating its growth plans. Vijay Shekhar Sharma is aiming to build 100 million wallets by the end of this year, against the current 25 million active wallets.
For Paytm, the average wallet balance is Rs 150. The company facilitates a million transactions a day, across its app and merchants (such as Uber and BookMyShow).
In 2014, grade-A office space taken on lease by online or internet firms in Delhi-NCR stood at 567,499 sq ft, against 84,000 sq ft the previous year, according to Cushman & Wakefield data. In Bengaluru, absorption by e-commerce firms rose to 622,811 sq ft from 453,495 sq ft, while in Hyderabad, it more than doubled - from 4,100 sq ft to 8,542 sq ft.
In Mumbai, the absorption increased from nil in 2013 to 27,000 sq ft in 2014. For Kolkata, it rose from nil to 4,600 sq ft.