Embassy REIT buys biz park in Bengaluru for Rs9,782 cr

Deal dynamics

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– The deal makes Embassy REIT the largest such entity in the whole of Asia in terms of developed area of 42.4 million sq ft and one of the largest in value with a market capitalisaiton of around $4.5 billion

– The deal comes at a 4.6% discount to the market value

– Embassy REIT is the first publicly-listed REIT (Real Estate Investment Trust) sponsored by Blackstone and the Embassy Group. It got listed in April 2019

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Mumbai, November 17

Embassy Office Parks REIT, the first listed and the largest such entity in the country, on Tuesday acquired a 9.2 million square feet Embassy TechVillage in Bengaluru from the Embassy Group, Blackstone and other investors for Rs 9,782.4 crore.

The deal makes Embassy REIT the largest such entity in the whole of Asia in terms of developed area of 42.4 million square feet and one of the largest in value with a market capitalisaiton of around $4.5 billion, Embassy REIT chief executive Michael Holland said.

The deal comes at a 4.6% discount to the market value, he said.

Embassy REIT is the first publicly-listed REIT (Real Estate Investment Trust) sponsored by Blackstone and the Embassy Group. It got listed in April 2019.

“Embassy REIT has agreed to purchase Embassy TechVillage, spanning 88 acres on the Outer Ring Road in Bengaluru from the affiliates of Embassy sponsor, Blackstone sponsor and other selling shareholders for Rs 97,824 million ($1.3 billion)”, the company said.

The property has 40 companies as tenants and they have over 45,000 employees there.

The deal is subject to unitholders’ and regulatory approvals, which Embassy REIT expects to get by the end of next month.

The acquisition comprises 6.1 million square feet (msqft) of completed area, 3.1 msqft under-construction area — out of which 1.1 msqft is almost ready — and two proposed Hilton hotels which will have 518 keys.

The acquisition will increase Embassy REIT’s commercial office portfolio by 28 per cent to 42.4 msqft, making it the largest in Asia in terms of developed area, Holland said.