Under this platform, Godrej Fund Management will have the ability to develop grade A office assets that will be valued in excess of $1.5 billion or Rs 11,000 crore on completion. The total value of office assets including those from its previous funds will take the portfolio value upon completion to over $3 billion or Rs 22,000 crore.
“We are pleased to partner with APG on our second build-to-core platform. Our group has strong conviction in India’s premium office sector and we believe the current dislocation in markets provides attractive capital deployment opportunities. The addition of this platform brings significant scale to our overall strategy and will open up strategic avenues for value maximization in the future,” said Karan Bolaria, Managing Director & CEO, Godrej Fund Management.
While the fund has raised $250 million as the first close of this fund, it has fully invested the previously raised capital under GBTC I and Godrej Office Fund I. This is the third India-focused office venture and fifth overall, sponsored by Godrej Fund Management and currently holds assets worth over $2.25 billion.
“We are looking forward to another successful partnership with Godrej. The build-to-core strategy for Indian offices aligns very well with our broader investment aspirations for our pension fund clients and our desire to invest alongside partners who offer best-in-class execution capabilities,” said Graeme Torre, Managing Director, APG Asset Management Asia.
Godrej Fund Management started investing in office projects around 2.5 years ago and counts global institutional investors like Allianz Real Estate apart from Dutch pension fund manager APG Asset Managements among its partners. APG has partnered GFM in four funds across residential and office segments.
Bolaria expects the entire fund raising to be completed later this year and will start deploying the fund immediately. The fund will retain its focus on key geographies of Mumbai, Pune, Bangalore and the National Capital Region as was the case with its previous fund. The entire fund is likely to be completely deployed by mid to late 2022.
Each of these transactions will have an average size of $110 million equity and $300 million enterprise valuation, he said.
Godrej Fund Management and subsidiary Godrej Investment Advisors together representing the Godrej Group, will be contributing 20% of the capital in this new office properties development fund.
GBTC is a club-style office investment strategy that invests in developing world-class office buildings in prime locations across the leading office markets in India. The platform currently has a strong investment pipeline and aims to deploy the newly raised capital within 12 months. The fund will be keen on investing in greenfield office assets that can be developed into grade A world-class projects.