GIC Pte Partners With ESR Cayman For $750 Million JV For Investment In Industrial, Logistics Realty In IndiaPage Visited: 20
GIC-ESR. (PC- Twitter)
Singapore-based sovereign wealth fund GIC Pte Ltd and Hong Kong’s ESR Cayman Ltd, on December 22, signed a 80:20 partnership deal to set up a $750 million joint venture. The new JV is aimed to develop and acquire industrial and logistics assets in India.
Under the new joint venture, a 2.2 million sq ft build-to-core asset near Mumbai and Thane will be seeded, after relevant regulatory approvals. Also, the new JV is aimed at focusing on Tier 1 and Tier 2 cities by developing and owning industrial, logistics facilities as well as acquiring core or operational assets.
“Continued e-commerce growth in India over the long term, reinforced by rising internet penetration, is expected to drive strong demand for industrial and logistics assets. This is further supported by the emphasis on infrastructure development, changing supply chains, and low vacancy levels. This joint venture is well-positioned to benefit from these tailwinds, bring institutional-grade assets into this market, and generate resilient returns,” LiveMint quoted GIC co-head Kishore Gotety as saying.
Recent infrastructure investment, supply chain modernisation, e-commerce expansion and favourable government policies are what experts believe to drive the consolidation of logistics real estate and raising demand for Grade A logistics infrastructure.
“GIC has been investing in India for more than a decade, and this investment is a testament to our confidence in the long-term potential of this market,” the business daily quoted GIC chief investment officer Lee Kok Sun.
While ESR India’s country heads Abhijit Malkani and Jai Mirpuri state this JV would provide immediate scale to capitalize on the early growth stages of India’s rapidly modernising industrial and logistics landscape. “…This strategic partnership provides us to tap high growth potential opportunities and further expand our industrial and logistics portfolio,” they added.
In a recent note by CBRE stands for Coldwell Banker Richard Ellis (CBRE), 3PL firms and e-commerce operators accounted for more than half of the leasing activity amid the pandemic-led disruption. This was followed by engineering and manufacturing firms.
The CBRE even stated that these days the modern, networked supply chain ecosystem is what occupiers are eyeing on, as these lay emphasis on near-shoring capability, sustainability and agility. Ensuring timely and transparent data flow among stakeholders is another aspect providing momentum.
“This digitisation is also moving towards warehousing facilities where, going forward, the use of AI, IoT and Big Data would result in the creation of smarter warehouses that would significantly improve supply chain efficiencies,” LiveMint quoted CBRE as saying.