CapitaLand India Trust (CLINT) has recently announced its plan to acquire an office project in Nagawara, Outer Ring Road, Bangalore for an estimated amount of $233.6 million. This strategic move will be executed through a forward purchase agreement with Maia Estates Offices.
According to CLINT, the acquisition of this 1.13 million sq ft office project is expected to bring in positive results for both the group and its unitholders. The company forecasts a net profit of $7.7 million on a stabilized basis and an increase in distribution per unit from 6.84 cents to 6.98 cents.
The office project, situated in a mixed-use development, will consist of both office and retail spaces. As part of the forward purchase agreement, CLINT will fully fund the development of the office project and receive interest on the funding at a higher rate than its borrowing cost.
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Upon completion of the development, CLINT is expected to acquire the office space in the first half of 2030, while Maia will retain the retail portion. This will result in a 9.9 million sq ft operational area for CLINT’s portfolio in Bangalore, up from the current 8.7 million sq ft.
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Apart from this new office project, CLINT has two other properties under development in Bangalore, namely, two office buildings in Gardencity, an IT Park at Hebbal, and another IT Park at ITPB.
With the addition of this office project, CLINT’s portfolio size, including its committed investment pipeline, will increase by 4.0%, from approximately 30.2 million sq ft to approximately 31.47 million sq ft.
Gauri Shankar Nagabhushanam, the CEO of CLINT, states that the acquisition of this prime office project in Bangalore will further strengthen the company’s presence in one of India’s most prominent office markets. He also points out that Bangalore had the highest ever leasing levels for Grade A office space in 2024 and that the Outer Ring Road is the largest office micro-market in the city. With this new addition, CLINT will be able to offer its tenants a wider range of premium office spaces in key micro-markets in Bangalore.
On February 21, units in CLINT closed at $1. The company is also currently in the process of acquiring International Tech Park Pune from its subsidiary and JV partner for $221.9 million and plans to develop 6 million sq ft of prime offices in India with Indian developer L&T Realty.