Government of Singapore’s sovereign wealth fund GIC is in final stages of talks to acquire up to 50% in Provenance Land that owns India’s first Four Seasons hotel and an under-construction luxury development in Mumbai’s sea-facing Worli area.
This deal will mark the GIC’s second-largest transaction in India after it agreed to buy 33.34% in Gurugram-based DLF’s rental arm for around $1.4 billion. The transaction is estimated to value the Jatia family controlled company at over Rs 2,000 cr.
GIC and Jatia’s Provenance Land plan to develop a commercial project on a two-acre land property next to the existing hotel and residential project site in Worli. Jatia’s Four Seasons Private Residences Mumbai, currently under construction, will also be part of this transaction. This project will have 26 branded and service apartments, including duplexes and penthouses, spread over 55 floors. The existing hotel property is the only operating Four Seasons Hotel in India with 202 rooms.
Promoters of Provenance Land are likely to use a significant portion of the money to support construction of a 0.5 mln sqft proposed office complex that will be developed next to the existing hotel. GIC has been investing aggressively in Indian real estate market.
Last month, in one such deal, realty developer Godrej Properties raised over Rs 1,000 cr through an issue of 12.76 million shares to an investor Gamnat Pte Ltd on preferential basis at Rs 783.50 per share. Gamnat, which has acquired the developer at entity level, is an investment firm managed by Singapore sovereign wealth fund GIC.
In September 2017, Whispering Heights Real Estate, a joint venture entity of GIC affiliate Reco Solis and K Raheja Corp acquired a prime three-acre land parcel at Worli from Siemens for Rs 610 cr. Large global institutional investors, including Blackstone Group, Brookfield Asset Management, GIC, Canada Pension Plan Investment Board (CPPIB), Goldman Sachs and Qatar Investment Authority, have been investing aggressively in Indian real estate assets over the past few years.
In addition to this, funds are also eyeing investment and alliance opportunities in the backdrop of recent policy reforms. While these entities had earlier shown interest in investing in commercial real estate, they are increasing their investment portfolios in the backdrop of the opening up of an avenue for monetisation through Real Estate Investments Trusts.