GIC, Morgan Stanley consider Mumbai real estate asset
Morgan Stanley and the Government of Singapore Investment Corp. (GIC) are among the suitors to purchase real estate in central Mumbai from domestic textile firm Alok Industries for $200 million, Reuters reported.
Sources told the newswire that Alok is looking to exit a building and its surrounding land, and the company has been negotiating with several funds on the sale. The area is known for its former textile-mill infrastructure, and several Mumbai-based textile companies are also said to be selling or developing their own real estate assets for corporate use.
India's real estate space was a key focus for private equity investors in 2010, but activity petered after the start of 2011. At the end of last year, firms such as Kotak Mahindra Bank, Matrix Partners India, IDFC and Baring Private Equity Partners India brokered notable investment deals. Rahul Bhasin, managing partner of Baring India, further confirmed in July of that year that his firm would strengthen its focus on real estate via investments from existing funds.
In terms of activity in 2011, Milestone Capital announced in January that it would raise a $110 million fund - its third - for real estate developments in India's eight largest cities, and Blackstone that month was reportedly set to make its first real estate investment in India, in a Bangalore-based project for $44 million, but other headline-making news for the remainder of the year has been few. However, news surfaced earlier this month that the Housing Development Finance Corp. (HDFC), India's largest mortgage lender, is looking to raise a $600 million fund from overseas investors.
According to research released by Venture Intelligence earlier this month, private equity investment into real estate accounted for 14 investments in the quarter ending September 2011, raking in $388 million across the eight deals with disclosed values. This was also down on the activity seen in the third quarter of 2010, in which PE invested in 21 targets, investing $744 million across 20 deals with disclosed values.
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