Bengaluru: Virtuous Retail South Asia Pte. Ltd (VRSA), the retail development arm of investment firm The Xander Group Inc., has acquired the Trilium shopping mall portfolio from Tata Realty and Infrastructure Ltd (TRIL) for $100 million.
VRSA’s acquisition comprises a shopping mall each in Nagpur and Amritsar, of around 700,000 sq.ft and 1 million sq.ft, respectively, which will boost its mall portfolio and expand its presence across both large and small cities.
VRSA also recently bought 20 acres in Thane, near Mumbai, from Raymond Ltd for ₹700 crore.
With these acquisitions, VRSA’s operational and under-development retail portfolio in India is currently more than 13 million sq.ft across Delhi, Mumbai, Bengaluru and Chennai, along with smaller cities such as Surat, Mohali, Amritsar and Nagpur.
The buyout of TRIL’s retail portfolio is in line with VRSA’s rapid, pan-India expansion strategy through both greenfield development and acquisition of existing, high-quality retail assets, the company said on Tuesday.
“2019 has been a year of active investments for us to broaden our shopping centre portfolio. Going forward, we would also explore acquisition opportunities in Kolkata and Hyderabad and add properties to the cities we are already present in," Sid Yog, founder and chairman of the board of VRSA said in a telephone interview. “We believe even gateway regional cities like Nagpur and Amritsar have significant population and retail consumption to make them attractive for us," he said.
Yog said the acquisition of the Tata Realty retail portfolio provides an immediate opportunity to reposition, rebrand and convert two existing, well-built assets in good locations into people-centric VR flagship centres.
In line with its approach to inorganic acquisitions, VRSA will invest additional capital and resources in repositioning and rebranding the Trilium shopping malls.
Sanjay Dutt, managing director and CEO, TRIL, said the divestment of the shopping malls is “in line with our business strategy to focus on expanding our commercial portfolio across key markets in the country and exit tier 2 & 3 cities".
In 2016, Xander partnered with Dutch pension fund manager APG Asset Management NV to form a joint venture to acquire shopping malls in India for about $300 million. A year later, APG infused an additional $175 million of fresh equity into the platform.
On the Raymond land it bought in Thane, which would be VRSA’s first retail presence in Mumbai Metropolitan Region (MMR), the firm will develop a 3.4 million sq.ft project. This would comprise nearly 2 million sq.ft of retail space while the remainder will comprise co-working, co-living facilities, hospitality and possible, an office tower as well, Yog said.
“Besides the capital spent on land buying, we will invest another $240 million to develop the Thane project. While we will only reposition and rebrand the Nagpur mall, the Amritsar mall will need some more investment and we may make some physical changes in the property," he said.