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Blackstone Buying Stake in Bengaluru Business Park Builder as India Empire Expands

2024/12/15 by Michael Cole Leave a Comment

Salesforce Bagmane

The Salesforce Tower in Bagmane Tech Park will be completed in 2026 (Image: Bagmane)

With Blackstone having filed for its fourth India REIT in September and with a fifth listed property trust reportedly on the way in 2025, the US fund management titan has been given the green light to pick up a stake in Bengaluru business park developer.

The Competition Commission of India, the country’s anti-trust regulator, announced this past week that it has approved the acquisition of stakes in Bagmane Developers Private Limited and Bagmane Rio Private Limited by entities controlled by Blackstone’s BREP Asia III fund, with a detailed order to be issued in the future.

The decision clears the way for Blackstone, which has already exited its stakes in two earlier office REITs and is said to be planning to launch an office trust together with local developers Sattva Group and Panchshil Realty, to further bolster its holdings in one of the world’s fastest growing commercial real estate markets.

Bagmane has 30 million square feet (2.8 million square metres) of operational business parks in Bengaluru with another 5.3 million square feet under development, according to its website, after occupiers leased a record 6.3 million square feet in the capital of southern India’s Karnataka state during the third quarter, per Colliers.

Hosting Salesforce

The Competition Commission’s statement did not provide details on the scale or financials of the potential stake sale, and neither Blackstone nor Bagmane had responded to inquiries from Mingtiandi by the time of publication.

Raja Bagmane

Raja Bagmane founded the developer in 1996 (Image: Bagmane)

Bagmane Tech Park, the company’s flagship development in Bengaluru, was established in 2001 and spans 4.7 million square feet. Bagmane has four more completed business parks in the city with three more under development.

Just over one month ago, US software giant Salesforce announced plans to open its first Salesforce Tower in India in Bagmane Tech Park, with that 600,000 square foot project expected to open in mid-2026. Other major occupiers in the park include Nike, Boeing, Cisco, Volvo, Dell and PwC.

Just last week Bagmane took steps to enhance its Bengaluru projects with the company signing a memorandum of understanding with the city’s metro system to connect its developments directly to three stations on the operator’s Blue Line. The company also paid to put its name on one of the metro stations, according to local news reports.

Riding the Indian Office Wave

After listing India’s first REIT in 2018, Blackstone has cashed in on the growth of the country’s office sector, including by exiting that vehicle, Embassy Office Parks, one year ago with a $854 million stake sale.

That disposal followed Blackstone’s sale of its remaining stake in Mindspace REIT, another office trust, to the Abu Dhabi Investment Authority for $235 million in January 2022. That REIT listed after Blackstone had acquired a 15 percent stake in a portfolio of office projects from developer K Raheja in 2017.

Citing sources familiar with the plans, local media reported earlier this month that, together with local partners Sattva Group and Panchshil Realty, Blackstone aims to raise $1 billion next year from an initial public offering of a REIT holding a portfolio of Indian commercial properties.

In September, Blackstone filed for its fourth India REIT, a hospitality trust which is expected to raise up to $238 million through its IPO.

Driven by rising demand from outsourced service providers, tenants leased 46.7 million square feet of grade A office space in India during the first three quarters of this year, according to Colliers, including 17.3 million square feet in the third quarter.

That figure for the July through September period was up 31 percent compared to the third quarter of 2023, the agency said, with Bengaluru and Hyderabad accounting for over half of that activity.

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Filed Under: Finance Tagged With: Bagmane Group, Bangalore, Blackstone, daily-sp, Featured, highlight, India

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