Amazon will soon have a new landlord in India’s fourth largest city, as Ascendas India Trust announced today that it is acquiring seven buildings in a business park in Hyderabad.
The Singapore-listed affiliate of developer Ascendas-Singbridge is paying a combined S$270 million ($200 million) for two of the buildings in southern India’s Telangana state, one of which is 98 percent occupied by Amazon.
The Hyderabad deal came less than a week after the Singapore-listed trust purchased a pair of office blocks in Mumbai.
Trust Builds Up Hyderabad Holdings
Ascendas India Trust on Monday announced its forward purchase agreement with Phoenix Infocity, the developer of the aVance Business Hub in HITEC City, Hyderabad to buy a pair of buildings named aVance 5 and 6 in the business park for S$270 million, according to a statement posted by the trust’s manager.
As part of the same agreement, Ascendas India Trust is also picking up upon their completion five additional buildings in aVance Business Hub 2, a business park under development adjacent to aVance Business Hub.
“The proposed acquisition of aVance 5 and 6 will allow us to deepen our presence in Hyderabad, which is currently witnessing robust rental growth arising from healthy demand from global IT companies,” said Sanjeev Dasgupta, CEO of the trustee-manager in the statement. “The opportunity to acquire an additional five buildings in future will allow the Trust to enjoy even greater economies of scale in Hyderabad, and further strengthen its competitiveness in the market.”
The trust already owns four of the ten buildings in the 4.6 million square foot aVance Business Hub. AVance 6, which the trust is acquiring under this latest agreement, is the building leased to Amazon, and measures 640,000 square feet (59,460 square metres). The other property, aVance 5 totals 1.16 million square feet, and is expected to be completed by the second half of 2019.
The Singaporean-listed property trust has a right of first refusal to acquire the four remaining buildings in the business park which measure a total of 1.2 million square feet
AIT India Portfolio Reaches 16M Square Feet
Upon the completion of the acquisition of aVance 5 and 6, as well as the Mumbai business park Aurum IT SEZ it agreed to purchase a week ago, the trust’s portfolio will increase to 16 million square feet, according to Dasgupta. Just last week, Ascendas India Trust announced it would buy up a pair of buildings under development worth up to S$186 million ($139 million) in Aurum IT SEZ in Mumbai.
Ascendas India Trust is managed by a unit of Ascendas, a subsidiary of state-owned property firm Ascendas-Singbridge Group. The trust owns properties across the Indian cities of Bangalore, Hyderabad, Chennai and Pune as well as in Mumbai.
Hyderabad, the fourth largest city in India by population, is an IT hub rivalling Bangalore. The city was also rated by consulting firm Mercer as the Indian city with the best living quality last year.