Public listed real estate developer Nitesh Estates Ltd has bought a shopping mall measuring 1 million sq ft in Pune through a wholly owned subsidiary for Rs 250 crore ($39 million), the company said in an announcement.
The retail asset is located in Koregaon, Pune and is spread across six acres with a capacity to accommodate 130 retail outlets. “The mall asset will generate over Rs 45 crore of rental income per annum after a couple of years. It will also enhance the company’s consolidated asset value,” the firm said.
The Bangalore-headquartered company was in negotiation with the owners of the mall for more than a year. The property had elicited interest from other suitors as well but the deals did not fructify due to a valuation mismatch.
The developer, which has presence across four asset classes, is building one of the biggest malls in Bangalore—Nitesh Mall. Located in Indira Nagar, it is spread across 1.2 million sq ft and has around 0.70 million sq ft of leasable area. Anchor tenants of the property include PVR, HyperCITY and Blu-O.
The acquisition of the Pune mall will enhance the firm’s retail portfolio to roughly 2.2 million sq ft.
Known for its luxury projects, the developer has 21.2 million sq ft under development across residential, commercial, hospitality and retail, and completed 13 premium residential, office and hospitality projects totalling 2.61 million sq ft as of December 31, 2014.
Mostly focused on the residential space in south India, the company has roughly 4 million sq ft of development in the pipeline.
It posted revenues of Rs 20.96 crore in the quarter ended December, 2014, down from Rs 31.10 crore in the previous quarter. Its net profit went down to Rs 0.80 crore from Rs 1.90 crore in the same period.
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