The JV will target stabilised and development assets, aiming to reach over Rs 5,000 crore (C$800 million) in assets under management.

Tata Realty and Infrastructure, and Canada Pension Plan Investment Board (CPPIB), have entered into a joint venture (JV) to develop and own commercial office space across India. The aggregate equity value of the deal is Rs 5,300 crore (C$8661 million). CPPIB’s equity commitment will be at Rs 2,600 crore. The JV will target stabilised and development assets, aiming to reach over Rs 5,000 crore (C$800 million) in assets under management.

The partnership will be seeded with two assets with a gross asset value of Rs 8,000 crore (C$1.3 billion) alongside an intention to further allocate capital investment of up to Rs 2,000 crore (C$333 million) for future acquisitions. The two assets include Intellion Park Chennai with 4.6 million sq ft of space and Intellion Edge Gurgaon in National Capital Region with 1.8 million sq ft. Both the properties are currently owned and managed by Tata Realty and Infrastructure. The two companies will also pursue Grade A commercial developments in key cities of Mumbai, Delhi, Pune, Bengaluru, Hyderabad, and Chennai.

Sanjay Dutt, managing director & CEO, Tata Realty and Infrastructure, said: “With CPP Investments as a strategic long-term partner, the vision of this joint venture is to provide world-class sustainable office space solutions to a diverse set of businesses. This will enable the opening up of new business opportunities for Tata Realty and Infrastructure Limited, allowing us to accelerate our current growth.”

Hari Krishna V, managing director, head of real estate for CPP Investments in India, said: “This new relationship with Tata Realty and Infrastructure Limited provides an excellent avenue from which to explore opportunities in the fast-growing commercial real estate sector. It is an important step in expanding CPP Investments’ relationships with leaders in the market, to deliver solid long-term adjusted risk-adjusted returns to CPP contributors and beneficiaries.”

Tata Realty had continued to maintain an optimistic stance towards commercial real estate all through the pandemic, even when the jury was out on the future of offices with the worsening Covid-19 situation in 2020. Dutt had told FE that the company is looking to build 45 million sq ft office space over the next 7-10 years.

Comparing the pandemic scenario to the global financial crisis, Dutt had said despite all the turmoil, 19 million sq ft of office space was taken up by companies back then. “This year (2020), between January and June around 11 million sq ft of commercial space has been committed and I believe another 10 million sq ft plus will be committed in the rest of the year, which means 20 million sq ft — despite lockdown and concerns around WFH will still get committed in India, especially when there is no supply, which is great,” he said.

https://www.financialexpress.com/industry/canada-pension-fund-in-joint-venture-with-tata-realty-to-invest-rs-2600-crore/2489727/