Singapore-listed technology park developer Ascendas is close to acquire an IT Special Economic Zone of Shriram Properties in Chennai for about Rs 500 crore, said banking sources close to the development. Ascendas, which owns a string of business parks in India, is said to have pipped competing offers from other global investors Tishmen Speyer, Xander Group and Mapletree, a real estate arm of Temasek.
Shriram Properties is the privately held real estate unit of the $9-billion southern conglomerate Shriram Group. Ascendas is the leading bidder for the 1.3 million sq ft special economic zone, which counts Accenture and Mahindra Satyam among others as tenants, and is part of a large integrated township located near the Chennai international airport.
The SEZ has potential to develop 3.2 million sq ft business space due to be completed in the next two years. Ascendas is expected to clinch a deal only for the already tenanted space and won’t have any right of first refusal for the development in the pipeline, said one of the sources mentioned earlier.
Shriram’s IT SEZ is part of a larger mixed use development on a 58 acre land, which it had bought from Standard Motors Factory in 2006.
Ascendas India Trust (a-iTrust), listed on the Singapore Stock Exchange, owns marquee technology parks in Bangalore, Chennai and Hyderabad. It has 92% stake in International Technology Park Bangalore (ITPB) and 89% stake in International Technology Park Chennai (ITPC), with the state governments being minority investors in both the projects. a-iTrust, which builds and operates business parks, is the only listed Indian property fund for global investors.
The latest deal is part of the global investor interest in Indian business spaces catering to technology clients. Private equity firm Blackstone Group acquired 1.8 million sq ft technology SEZ of real estate developer DLF in Pune for Rs 810 crore last year.
It also struck a similar sized investment deal with Embassy Group for one of the largest IT SEZs in Bangalore. Private equity firms and global investment houses are allocating a part of their portfolio to risk free income yielding assets, such as IT business parks, which provide 9% to 12% assured returns besides providing capital value appreciation.
