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Hines India plans to sell 50% stake in Gurugram commercial property

08 June, 2018

The local unit of US-based property investment firm Hines is planning to sell its 50% stake in a commercial building in Gurugram, the Mint daily reported, citing two people familiar with the development.

Hines India’s stake in the One Horizon Center will be valued around Rs 700-800 crore, the report said, citing two property consultants it didn’t name. Property developer DLF Ltd owns the remaining 50% in the asset.

It also quoted an unnamed Hines spokesperson as saying that the firm has started working on the stake sale process and that a proper strategy will emerge in due course of time. “We believe that it is a good time to be considering a sale as there is significant demand from investors and such sale has always been part of our investment fund strategy,” the spokesperson said.

The spokesperson also said that Hines plans to take up development of new projects in prime locations across India.

The stake sale plan comes soon after Hines sold its commercial building, Sky View Corporate Park, to a real estate fund of Indiabulls and InterGlobe Real Estate Ventures Pvt. Ltd for roughly Rs 200 crore.

Hines entered India’s commercial realty segment in 2006. It had two projects in its India kitty. It is now actively focussing on residential side of the market as well.

The firm recently elevated Amit Diwan, who was senior director of investments at the firm, to the position of managing director and country head. This followed Yash Gupta’s decision to move on from the role and take up an entrepreneurial role.

While the residential market is still under pressure, the commercial real estate segment has been hitting headlines for deals over the last few years.

VCCircle recently reported that Ascendas Firstspace Development Management Pvt. Ltd, a joint venture of Singapore’s Ascendas-Singbridge Pte Ltd and Indian industrial developer Firstspace Realty LLP, had bought a logistics park near Chennai in what is its first known acquisition since it was set up last year.

SP Infocity, a marquee commercial building owned by Shapoorji Pallonji Group and Canada Pension Plan Investment Board in Chennai, is on the block and a bunch of investors have shown interest to lap up the asset.

According to a recent report by real estate consultancy firm ANAROCK Property Consultants, the commercial and retail asset classes saw a healthy upsurge of private equity investment inflows in 2017.

It added that the government’s recent move to allow 100% foreign direct investment in single-brand retail through the automatic route and relax sourcing norms will work as a catalyst for investment inflows in these asset classes.

“Also, the first REIT [Real Estate Investment Trust] listings are likely to happen in the upcoming months of 2018. The REITs will infuse substantial liquid inflows into the commercial real estate asset class,” it said. This, in turn, will improve the execution capacity of developers focused on this sector it added.

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Hines India plans to sell 50% stake in Gurugram commercial property

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