Synopsis
Maia Estates Offices has entered into a forward purchase agreement with CapitaLand India Trust to acquire an office project in Bangalore for over Rs 1471.7 crore. The project, a part of a mixed-use development, will be fully funded by CLINT, with the acquisition expected to finalize in 2030.
Maia Estates Offices,an affiliate of Bangalore-based luxury residential developer Maia Group (Maia), has raised Rs 1,000 crore from CapitaLand India Trust (CLINT) to finance its office project at Nagawara, Outer Ring Road (ORR), Bangalore, said a top company official.
According to the sources the acquisition price may vary once the project is completed and depend on the net leasing value. The office project is part of a 4.6 mixed-used development with a total net leasable area of approximately 1.36 million sq ft. The mixed-use development is a maiden commercial project of Maia, comprising office and retail space with net leasable areas of 1.13 million sq ft and 0.22 million sq ft respectively.
“ We are actively expanding our commercial portfolio in Bengaluru and Chennai while exploring opportunities in other major metros, driven by rising office space demand from large corporations, including global capability centers,” said Mayank Ruia, founder and CEO of MAIA Estates.
As part of the forward purchase arrangement, CLINT will fully fund the development of the office project and receive interest on the funding at a rate which is higher than its borrowing cost. Upon completion of the development and stabilisation, CLINT is expected to acquire the office space in 1H 2030, while Maia will retain the retail portion.
“The acquisition of this strategically located office project will further strengthen CLINT’s presence in Bangalore, one of India’s most prominent office markets. This forward purchase marks the beginning of our partnership with Maia, a luxury developer in Bangalore with a strong track record,” said Gauri Shankar Nagabhushanam, Chief Executive Officer of CapitaLand India Trust Management Pte. Ltd. (the Trustee-Manager of CLINT).
The acquisition of the office project is expected to improve the earnings and distributions for Unitholders. Net profit from the acquisition is forecasted to be approximately S$7.7 million on a stabilised basis, while distribution per unit is expected to increase from 6.84 cents to 6.96 cents, based on projected financials.
Additionally,upon completion, the office project will increase the operational area of CLINT’s portfolio in Bangalore from 8.7 million sq ft to 9.9 million sq ft. In addition to the office project and International Tech Park Bangalore (ITPB), CLINT’s other properties under development in Bangalore are two office buildings in Garden City, an IT Park at Hebbal with a total net leasable area of up to 1.65 million sq ft; Ebisu, a 1.0 million-sq ft IT Park located at ORR and a data centre in ITPB.
“During the construction period, CLINT’s investment in the project will be through divestment proceeds over the near term, debt and internal resources. The forward purchase agreement will be executed upon completion of the office project construction and is subject to receipt of the occupancy certificate and the fulfilment of other key conditions.CLINT’s funding towards the development of the retail area will be repaid by Maia Estates Offices Private Limited at the time of the acquisition of the office space,” CapitaLand said.
Overall with the acquisition of the office project, CLINT’s portfolio size inclusive of committed investment pipeline will increase by 4.0% from approximately 30.2 million sq ft to approximately 31.4 million sq ft.