Bengaluru: Godrej Fund Management has acquired a stake in a commercial office project in Bengaluru which is being developed by Century Real Estate Holdings Pvt. Ltd for around ₹850 crore, said two people familiar with the development.
The 2.5 million sq. ft project, located within the Hebbal micro-market in the city’s northern part, is expected to be completed in three years.
The investment has been made from Godrej Fund Management’s $450 million office investment and development platform. The fund, Godrej Build to Core-1, has received commitments of around $150 million from Allianz Real Estate and another $150 million from Dutch investor APF Asset Management.
“Godrej Fund Management gets around 35% of built-up area in the project against its stake acquisition. The capital will be used for constructing the project," said the first of the two people, both of whom spoke under condition of anonymity.
Century Real Estate’s managing director Ravindra Pai declined to comment. A Godrej spokesperson didn’t respond to queries.
Century, which owns a large land bank in Bengaluru, has a residential development portfolio, and is now planning to also build commercial office projects.
It has a project development pipeline of around 7 million sq. ft over the next four to five years.
Among the projects planned is a prime office development on St Marks Road, in central Bengaluru, which Century is developing with real estate firm Vaswani Group.
The commercial office market has outperformed the residential sector in the country, and attracted high institutional investor interest. Rentals have risen, there is robust demand for good quality office space and India’s first real estate investment trust (Reit) was launched by Embassy Office Parks earlier this year. As a result of this, many office developers are expanding their portfolios or monetizing their holdings to extract maximum value.