Mumbai: Mumbai-based retail developer Phoenix Mills Ltd on Friday said it has acquired an under-construction mall at Indore for Rs234 crore—its second such purchase in a Tier II city in less than a month.

Earlier this month, the company announced the acquisition of an under-construction mall in Lucknow for Rs453 crore.

The Indore property, which has a gross leasing area of 1.1 million sq. ft, was acquired through Insight Hotels & Leisure Pvt. Ltd, a subsidiary of Phoenix Mills, in an auction conducted by an asset reconstruction company, the developer said in a filing to BSE.

The company said it would develop the asset as Phoenix MarketCity Indore, which would be operational by the end of fiscal 2021. So far 80% of the construction is complete. The company also plans to develop another 800,000 sq. ft of gross leasing area at a later stage, it said .

“Indore is an under-served market for quality retail and entertainment experiences while the population has a high propensity to spend. Given that Indore does not have large format retail centres and has limited options to socialise, Phoenix MarketCity Indore will be a marquee retail destination that Indore deserves," said Shishir Shrivastava, joint managing director, Phoenix Mills.

The acquisition is in line with the company’s plan to expand its retail portfolio to 11-12 million sq. ft from the existing 6 million sq. ft, he said. “With acquisitions of two land parcels in Pune and Bengaluru and two brownfield acquisitions in Lucknow and Indore, we will add approximately 4 million sq. ft of retail space to our portfolio," he said.

In April 2017, Phoenix Mills and Canada Pension Plan Investment Board (CPPIB) announced that the latter will invest $250 million to own up to 49% in Island Star Mall Developers, a unit of the developer. Island Star Mall Developers owns Phoenix MarketCity in Bengaluru, a mall with gross leasable area of 1 million sq. ft. The investment platform was created to ramp up its retail business and expand to other cities. At present, Phoenix Mills has a presence in Mumbai, Pune, Bengaluru, Lucknow, Chennai and Bareilly.

Since the CPPIB tie-up, Island Star has bought two land parcels each in Pune and Bengaluru. It spent Rs160 crore to buy land in Pune and has also bought a plot in Hebbal, Bengaluru, for Rs650 crore from L&T Constructions.