PAG Invests $55M in Indian Developer Elan to Help Fund Future Projects

Hong Kong private equity firm PAG has invested $55 million in Indian developer Elan Limited, as global fund managers continue to pursue real estate opportunities in one of the world’s biggest markets.

PAG’s commitment will go towards upcoming projects, according to Elan, the flagship company of Gurugram-based Elan Group, which has 12 developments across the National Capital Region with a total saleable area of 15 million square feet (1.4 million square metres).

Saurabh Shatdal, managing director of land and capital markets for India at Cushman & Wakefield, confirmed the $55 million transaction in a Monday LinkedIn post. India’s Economic Times first reported the deal, for which Cushman acted as advisor.

“This deal assumes great significance for the Elan Group with a global fund like PAG reposing confidence in the group’s management and established development track,” said Elan Group chief financial officer Sandeep Agarwal.

Expansion in Progress

Elan Group is scaling its existing portfolio of retail and commercial assets and entering the high-end and premium residential segment through the recent $72 million acquisition of 40 acres (16.2 hectares) along the Dwarka Expressway in Gurugram from Indiabulls Real Estate, according to the Economic Times.

The company controlled by the Kapoor family also recently acquired a prime commercial land parcel of 7.65 acres from Ambience Group for about $25 million, the newspaper reported.

PAG expanded its operations in India in early 2019 with the hiring of KKR veteran Nikhil Srivastava to help direct its buyout business in the country. The investment firm led by Weijian Shan had reportedly been planning to ramp up its India presence since 2018.

Records from India market data provider VCCEdge indicated that PAG invested in Indian non-bank financial company Asia Pragati Capfin in 2010, and the Hong Kong firm is said to have had a relationship with Mumbai-based investment advisory firm Arpwood Capital.

Piece of the Action

PAG, which reportedly delayed a planned $2 billion Hong Kong IPO of the firm, has joined rival fund managers investing in India’s real estate market.

Blackstone earlier this year launched Horizon Industrial Parks, a portfolio of Indian logistics assets assembled from a series of warehouse investments by the US private equity titan, which also owns the Nucleus Office Parks portfolio and the Nexus Malls retail platform.

Bloomberg reported last week that Blackstone was planning to file for a $500 million IPO of its Indian mall portfolio under Nexus Malls.

In August, US developer Hines took on its first project in India’s commercial capital with the announcement of a 30-storey office development in Mumbai. The project added to the privately held firm’s existing 16 million square foot India portfolio just a few months after Hines announced a second development venture in Bangalore with local builder DNR Group.