Blackstone acquires Embassy Industrial parks for Rs 5,200 crore

“Logistics is likely one of the agency’s highest world conviction themes, anchored by our perception that e-commerce traits will additional gas demand for logistics house particularly close to metropolis centres”.

Blackstone on Monday mentioned it has acquired Embassy Industrial Parks, a three way partnership of Warburg Pincus and Embassy, which controls 22 million sq ft (MSF) of largely Grade-A warehousing house throughout main industrial hubs together with Bengaluru and Delhi. The deal is value round $700 million or roughly Rs 5,200 crore.

Embassy Industrial Parks’ warehouses are positioned throughout main industrial hubs together with Bengaluru, NCR, Hyderabad in addition to Pune, and are leased to main e-commerce and retail gamers. Blackstone believes that e-commerce will gas demand for logistics house, particularly close to metropolis centres.

The acquisition of Embassy Industrial Parks makes Blackstone India’s largest warehousing house supplier with 40 MSF of belongings, most of which is Grade-An area. It had final yr inked agreements to accumulate 18 MSF from the Hiranandani group and All Cargo.

The funding main controls round 1.2 billion sq ft of logistics house worldwide. Folks near the developments mentioned Embassy Industrial parks is exiting the total 22 MSF, which is valued at round $700 million. Monday’s announcement is about Blackstone buying 10.6 MSF, which is owned by Warburg Pincus within the JV with Embassy.

“This was the primary half. Within the second half, Blackstone will choose up a further 11 MSF from Embassy. On this, Embassy has developed round 6 MSF house. Relaxation is Embassy’s JV with Brookfield for a further 5 MSF house. So the whole is 11 MSF, 6 MSF and 5 MSF of warehousing belongings,” an individual within the know of the developments defined.

On the rationale behind the acquisition, head of Blackstone’s Actual Property India Acquisitions, Asheesh Mohta mentioned,

“Logistics is likely one of the agency’s highest world conviction themes, anchored by our perception that e-commerce traits will additional gas demand for logistics house particularly close to metropolis centres”.

That is significantly true in India, the place e-commerce is in its nascent stage and has great alternatives pushed by constructive traits in urbanisation, home consumption and the rising retail sector, which stays closely under-penetrated in comparison with main economies globally.

As an example, Bengaluru, the e-commerce hub, solely has 30 million sq. toes of whole Grade A and B warehouse house in comparison with 1.2 billion sq ft in Chicago, he added.

“Blackstone is among the many high 10 enterprise teams in India by the whole worth of belongings and the transaction will assist reinforce the agency’s main place within the workplace, retail and logistics,” the worldwide funding agency mentioned.

Blackstone’s head of actual property India, Tuhin Parikh mentioned: “India is a novel market with stable progress potential, supported by its world management in data expertise, sturdy expertise pool, and authorities initiatives to draw overseas funding such because the introduction of a simplified tax construction and infrastructure initiatives”.

“This transaction between Embassy Group and Blackstone additional strengthens and reinforces our partnership. We’re extraordinarily centered on consolidating our assets in direction of the expansion of our core companies of workplace and residential improvement and administration. This transaction with Blackstone Actual Property together with the upcoming merger with IBREL is a strategic transfer in that course,” Embassy group’s CMD, Jitu Virwani mentioned.