Bengaluru: Singapore’s Xander Investment Management has set up a $250 million industrial real estate venture to purchase assets in the high-growth logistics and e-commerce sectors at industrial corridors across major cities in India.
Sponsored by Xander Group, the platform has raised capital from leading European institutional investors that have previously been limited partners in the firm’s sponsored opportunity funds.
Xander Investment is the private equity real estate arm of The Xander Group Inc., a global investment firm.
Xander Investment will be the investment advisor to the platform that will invest the capital in high-quality assets over the next 12 months.
The platform has recently acquired two million sq. ft of industrial assets in Mumbai and Chennai for $80 million. It is anchored by multinational and domestic corporations such as Amazon, Kerry Indev, DB Schenker and TVS Logistics.
“We have been investing opportunistically in the industrial/logistics sector since 2007. With the economy poised for retail, manufacturing and consumption growth, it is the opportune time for us to create a platform with like-minded investors that will execute a longer term, targeted program," Rohan Sikri, senior partner, Xander Group and managing director of Xander Investment said in a statement.
As international and domestic companies expand their footprint in India to cater to this growth, the platform will be well-positioned to capitalize on the underlying demand for high quality, institutionally owned/operated industrial real estate, Sikri added.
Industrial real estate is fast emerging as the go-to class for developers and investors in India, driven by growth in the e-commerce and consumption sectors, and aided by the Union government’s Make in India initiative and the introduction of the goods and services tax (GST).
Ram Reddy, managing director, Xander Advisors India said, “The group has a strong presence across the real estate ecosystem in India and our exposure to the retail and industrial sector in India positions us well to execute on this new platform. Our expansive advisory network in India enables us to leverage our local expertise and relationships to provide best in class solutions to global and domestic occupiers."
Logistics leasing grew 31% on a yearly basis, crossing 13 million sq. ft, according to an August report titled India Industrial and Logistics Market View, H1 2019 by property advisory CBRE South Asia Pvt. Ltd. Mumbai, Chennai and Bengaluru comprised more than 60% of leasing activity.
“...As technology permeates the sector, demand for quality space is increasing and corporates across segments are opting for large, modern warehouses. Advances in technology, particularly automation, will continue to enhance the specifications and operations of logistics assets, thereby pushing older, inferior-grade properties down the demand pyramid," the CBRE report said.
This year, Xander has announced multiple investments across its verticals such as commercial office and retail.
In August, Xander acquired Weikfield IT Citi Info Park, an office park in Pune, for $130 million ( ₹900 crore), marking the deepening presence of global investors in India’s expanding commercial office sector. Xander purchased the 1.1 million sq. ft office park from private equity firm New Vernon Capital, Llc.
In October, Raymond Ltd said it is selling a 20-acre land parcel in Mumbai’s Thane area to Xander-backed Virtuous Retail South Asia (VRSA) for ₹700 crore.
VRSA is the retail development and investment arm of the Xander Group.