Ajay Piramal-backed Piramal Capital and Housing Finance’s Indiareit Fund V, which invests in domestic realty projects, has exited Skylark Developers’ special purpose vehicle (SPV), which held a commercial land parcel in the central business district (CBD) of Bengaluru.
The SPV was sold to Bengaluru-based SNC Pvt. Ltd, which specializes in civil works for infrastructure work, including thermal power, hydro power and irrigation projects.
The construction company plans to invest ₹100 crore to develop an office space on the land, said a press release issued by JLL India, which was the sole transaction advisor to both parties.
“There has been a rise in investor interest in acquiring prime commercial land parcels and this development is significant. In line with our core objectives of serving our valued clients, we are pleased to have advised on this asset sale," said Rahul Arora, managing director, Bengaluru, JLL.
The sale of the land off Richmond Road will enable the development of an investment-grade commercial project, contributing to the restricted supply in the highly-sought-after office market, JLL said. “The vacancy levels in CBD have remained <6% due to which the rentals have moved up significantly in the last couple of years. Currently rent for grade-A space ranges between ₹150 and ₹175 per sq. ft per month, and land values vary between ₹25,000 and ₹50,000 per sq. ft," it added.
Launched in 2013, Indiareit Fund V had raised commitments worth ₹1,000 crore. It had a primary tenure of six years, which was extended by another two years. On 17 July 2019, the fund extended its primary tenure from 31 July 2019 to 31 August 2020, citing difficulty in exiting some of its residential projects, as the developers were facing a liquidity crisis and subsequent project delays.