Soverign Wealth Funds GIC, QIA And ADIA In Talks To Invest $400 million Real Estate Major Prestige Estates

Singapore’s sovereign wealth fund GIC, Qatar Investment Authority (QIA) and Abu Dhabi Investment Authority (ADIA) are in talks to invest about $400 million in Bengaluru, India–based real estate developer Prestige Estates, The Times Of India reported.

Prestige Estates is looking to monetize some of its retail mall and office assets before it goes for a REIT (real estate investment trust) listing by the end of this year. REITs are listed entities that invest in leased office and retail assets allowing developers to raise funds by selling completed buildings to investors.

The company’s Chief executive Venkat Narayana said in a post-earnings call that real estate major is in negotiations with two to three large investors to raise $300 million to $400 million prior to turning into a REIT.

Narayana also confirmed the fundraising plan and said around 6 million square feet of retail and commercial office space will be ready in the next 10 months.

Despite a tepid real estate market that has seen many real estate players facing tough challenges, Prestige group has been able to weather the storm and due to prudent business practices. With its complete focus on Bengaluru, it also has no presence in more competitive markets like New Delhi and Mumbai.

Over the last two years, Prestige has developed a total of 24 million square feet of real estate annually. The company has another 50 million square feet under construction and execution this year. These projects include a mix of hotels, commercial real estate, malls, and residential units.

Most of Prestige’s projects in Bengaluru launched in the last three years were located along the upcoming metro lines. These include Prestige Falcon City, Prestige Park Square and Prestige Elysian.

REIT’s have become a sought-after fundraising instrument in India since Blackstone-backed Embassy Office Parks went public with the country’s first offering. In December, K Raheja Corp and Blackstone also filed for a REIT, looking to raise Rs 1,000 crore through fresh issue of shares.