Singapore-listed real estate investment trust CapitaLand India Trust (CLINT) has announced its intention to acquire an office project in Bangalore, India for a price of $233.6 million. The project, located in Nagawara on the Outer Ring Road, will be acquired through a forward purchase agreement with Maia Estates Offices.
According to CLINT, this acquisition of the 1.13 million square feet office project is expected to bring in greater earnings and distributions for its unitholders. On a stabilized basis, the trust is forecasting a net profit of $7.7 million, with a projected increase in distribution per unit from 6.84 cents to 6.98 cents.
The office project forms part of a mixed-use development that also includes retail space. Under the terms 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 the completion of the development, CLINT is expected to take ownership of the office space in the first half of 2030, while Maia will retain the retail portion. This will result in an increase in the operational area of CLINT’s portfolio in Bangalore from 8.7 million square feet to 9.9 million square feet.
In addition to this acquisition, CLINT also has two office buildings under development in Gardencity, an IT Park at Hebbal, and another IT park at International Tech Park Bangalore.
With this latest addition, CLINT’s portfolio size will increase by 4.0% from approximately 30.2 million square feet to approximately 31.47 million square feet, including its committed investment pipeline.
“The acquisition of this strategically located office project will further strengthen CLINT’s presence in Bangalore, one of India’s most prominent office markets. In 2024, Bangalore recorded its highest ever leasing levels for Grade A office space. The Outer Ring Road is the largest office micro-market in Bangalore. With the addition of this prime office property, we will be able to provide our tenants with a wider range of premium office space options across key micro-markets in Bangalore,” said Gauri Shankar Nagabhushanam, CEO of CLINT.
CLINT’s units closed flat at $1 on February 21.
In Summary:
CapitaLand India Trust (CLINT) has announced its plans to acquire an office project in Nagawara, Bangalore for $233.6 million through a forward purchase agreement with Maia Estates Offices. The acquisition is expected to improve earnings and distributions for unitholders with a projected net profit of $7.7 million and an increase in distribution per unit from 6.84 cents to 6.98 cents. The office project is part of a mixed-used development that also includes retail space. CLINT will fully fund the development and receive interest at a higher rate than its borrowing cost. This will increase the trust’s operational area in Bangalore from 8.7 million sq ft to 9.9 million sq ft. The CEO of CLINT, Gauri Shankar Nagabhushanam, stated that the acquisition will strengthen the trust’s presence in Bangalore, which is one of India’s top office markets, and provide tenants with a broader range of premium office space options. CLINT’s units closed flat at $1 on February 21.
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