Godrej arm raises $ 250 million for office fund

Godrej Fund Management (GFM), the real estate private equity arm of the Godrej Group, marked the first close of its $ 500 million office development platform, GBTC II, at $ 250 million.

It raised $ 200 million from the existing investor, the Dutch company APG Asset Management NV, and $ 50 million from the Godrej group.

It will increase the remaining amount over the next 12 to 15 months.

GBTC has a “club style” office investment strategy of buying land and developing office buildings in key cities. The platform has a strong investment pipeline and aims to deploy the new capital within 12 months.

It is the third India-focused office company and the fifth overall, sponsored by GFM.

GMF previously raised the $ 450 million Build to Core office development fund and $ 150 million office investment fund, which are fully deployed.

“The build-to-core strategy for Indian offices aligns very well with our broader investment aspirations for our pension fund clients and our desire to invest alongside partners that offer the best capabilities to execution, ”said Graeme Torre, Managing Director of APG. Asset Management Asia.

“Our group has a strong conviction in the high-end office sector in India and we believe that the current dislocation of the markets offers attractive capital deployment opportunities”, Karan Bolaria, Managing Director and Managing Director of GFM.

Mint had announced last September that GFM aimed to raise a fund of $ 500 million by early 2021 to invest in office buildings, and was in talks with global investors.

Godrej’s move comes at a time when the Indian trade office market has suffered a severe blow from the covid-19 pandemic, but continues to attract long-term investor interest.

GFM will develop office buildings that will be valued at over $ 1.5 billion on completion and the total value of office buildings, including those from previous funds, will bring the portfolio value on completion to over $ 3 billion.

The average size of the projects will be around one million square feet each with an investment of around $ 100 million in equity, Bolaria said.

He examines projects in Mumbai, Pune, Bengaluru and the National Capital Region.

“Global institutional investors are very interested in investing in the fund. Our development pipeline will be ready in 24 months and we are creating offices ready for the future and we expect high demand for good quality properties, ”said Bolaria.

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Jose C. Birney