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Blackstone Will List Its Office Assets With Embassy Group In A REIT

Koshal Shelar

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Blackstone To Declare Its Office Assets With REIT

US-based Equity Firm Blackstone is set to declare its office assets with REIT.

Blackstone, a US-based Equity Firm will be working in collaboration with Bengaluru-based Embassy Property Development to declare its office assets with REIT. Both Blackstone and Embassy have roped in Bank of America, Morgan Stanley, Kotak Mahindra Bank, and JP Morgan and others for this issue.

The REIT (Real Estate Investment Trust), registered as Embassy Office Parks is supported by Blackstone and Embassy Property Developments. The Embassy Office Parks owns 35 million sq ft office space in Bengaluru and Pune. A majority of these properties are fully leased and occupied.

The assets of Blackstone to be added to the portfolio include 247 Park in Mumbai’s Vikhroli suburb, Blackstone’s 50% ownership in First International Financial Center (FIFC) in Mumbai’s Bandra-Kurla Complex business district. Blackstone will be putting integrated office parks and city-centre buildings in the REIT. The addition of Blackstone’s prime assets across three major property markets will expand the size of the portfolio being considered for the listing.

The Blackstone-Embassy alliance is expected to raise $1 billion through this issue, India’s maiden REIT. Blackstone also has major stake in joint investment properties including Embassy Group, Pune-based Panchshil Group, Mumbai-based K Raheja Corp and the Salarpuria Sattva Group of Hyderabad.

Many global institutional investors including Blackstone, Brookfield Asset Management, GIC, Canada Pension Plan Investment Board, Ascendas-Singbridge and Qatar Investment Authority have been investing in the Indian real estate for the last few years.

Blackstone has emerged as a major institutional investor in India’s real estate sector, selecting properties in major cities that are benchmarks in the sector. It owns India’s biggest portfolio of income-producing office assets totalling around 110 million sq ft across the property markets of Mumbai, Noida, Pune, and Bengaluru.

In March, Blackstone formed an alliance with Indiabulls Real Estate via joint venture platform by acquiring 50% in the developer’s prime commercial office-space assets in Mumbai at a value of Rs. 9,500 crores and was one of the largest transaction carried out by the group.

“Blackstone is adding a few of its own assets in Mumbai, the Delhi-NCR, and Pune to its portfolio, a part of which will be listed as a REIT. With a fundraising estimate of around $1 billion, the portfolio would value at over $5 billion”, said one of the people.

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