Canada’s Ivanhoé Cambridge and QuadReal Property Group are backing Logos Property’s India expansion through a joint venture that expects to invest $800 million in logistics facilities across the country, as global investors look to capitalise on India’s fast-rising industrial real estate sector.
Vancouver-based QuadReal, which manages the real estate portfolio of British Columbia pension fund giant bcIMC, is joining Montreal-based Ivanhoe Cambridge, in backing Logos India Logistics Venture, a warehouse development initiative first announced in August of this year, according to a statement today by the investment managers and their partners.
The Canadian investors are joining with Aussie-managed Logos Property and its India-based partner Assetz Property Group in the joint venture which aims to build modern logistics facilities in select cities across the world’s second-most-populous country.
Building a Foothold in India’s Logistics Market
“We are pleased to invest in the logistics space in India, a promising high-growth real estate sector,” said Rita Rose Gagné, President for Growth Markets with Ivanhoé Cambridge in the statement. “India is a strategic market for Ivanhoé Cambridge and we are continuing to grow our presence and our footprint there.”
The Canadian investors are combining to provide $400 million in equity for the Logos India Logistics Venture, with the JV partners planning to raise an additional $400 million in debt, according to an account in Reuters today.
“We are focused on meeting the strong demand from our customers and ensuring we can help them grow to address the challenges of the India supply-chain market,” commented Trent Iliffe, joint managing director of Logos Group.
The announcement today confirms that Logos has fulfilled its capital-raising targets from August, when the developer first unveiled its new Indian platform with Bangalore-based Assetz. The partners hired logistics and supply chain veteran Mehul Shah as CEO of Logos India to build a team in Mumbai .
The group says that it already has identified a pipeline of projects and anticipates building and managing some 20 million square feet (1.9 million square metres) of modern facilities in the logistics hubs of Mumbai, Pune, Chennai, New Delhi, Bangalore, Hyderabad and Ahmedabad, the partners announced at the time. Assetz co-founder and CEO Ben Salmon told Indian business news portal Livemint that Logos India would be valued at around $1 billion upon completion of the assets.
Logos Goes Multi-Market
“We’re pleased to be expanding our relationship with Ivanhoé Cambridge to India and welcoming QuadReal as a new partner,” Logos’ Iliffe addedIliffe. “India is the next step in our Pan-Asian real estate strategy.”
Logos’s India expansion follows the company’s move last year into Singapore, with Ivanhoe Cambridge having announced in March of this year that it was investing $484 million into that plan to acquire, develop and manage logistics facilities in southeast Asia. The Australian firm also has received backing from CBRE Global Investors for its projects in China.
The newly announced Logos India Logistics Venture will have an investment capacity of $800 million, and final closing is subject to regulatory approvals. Australia’s Macquarie Capital managed the capital-raising for the new venture.
Another Canadian Investor Joins the Fray
The fresh commitments from Ivanhoé Cambridge and QuadReal add to a growing wave of global capital targetting India’s logistics and light industrial market, which has drawn investment from such heavyweights as Singapore’s Ascendas-Singbridge Group, Canada Pension Plan Investment Board (CPPIB), and US private equity firm Warburg Pincus.
QuadReal is a real estate investor, developer and manager owned by bcIMC, the fourth-largest fund manager in Canada. The company was formed to manage the C$24.5 billion ($19.3 billion) global real estate investment portfolio of the British Columbia pension giant, which includes more than 16 million square feet (1.5 million square metres) of industrial assets.
“After extensive due diligence to understand the economic, demographic and government forces driving growth in India, we are delighted to be partnering with Ivanhoé Cambridge and LOGOS India to invest in the logistics sector in strategic Indian markets,” commented Jonathan Dubois Phillips, president of international real estate at QuadReal in the statement.
Ivanhoé Cambridge, the real estate subsidiary of the Caisse de dépôt et placement du Québec – a leading Canadian institutional fund manager – had around C$56 billion ($41.7 billion) in assets at the end of last year.