CapitaLand India Trust to Buy Bengaluru Offices for $170M After Funding Project

Singapore’s CapitaLand India Trust has agreed to the forward purchase of an office project at a Bengaluru commercial complex developed by local builder Maia Group.

CLINT will fully fund development of the office project in the northern suburb of Nagawara and receive interest on the funding at a rate greater than borrowing costs, the SGX-listed REIT’s manager said Friday in a release. Upon completion and stabilisation, CLINT plans to buy the project’s 1.13 million square feet (104,980 square metres) of office space in the first half of 2030 for INR 14.7 billion ($170 million), with Maia retaining the retail section of the complex.

The acquisition is expected to further strengthen CLINT’s presence in Bengaluru after the market saw its highest-ever leasing for Grade A office space in 2024, according to the manager, which is owned by Temasek-controlled CapitaLand Investment. The project’s completion will boost CLINT’s operational area in Bengaluru by 14 percent to 9.9 million square feet.

“With the addition of this prime office property, we will be able to provide our tenants with a larger offering of premium office space options across key micro-markets in Bangalore,” said Gauri Shankar Nagabhushanam, chief executive of the manager.

Betting on Tech Hub

The proposed project’s site is less than 1 kilometre (0.6 miles) from Bengaluru’s Outer Ring Road and lies near a future mass transit station scheduled to be completed by 2026.

CLINT will fund its investment in the project through near-term divestment proceeds, debt and internal resources, the manager said. The forward purchase will be executed upon completion of the project’s construction and is subject to receipt of the occupancy certificate and fulfilment of other conditions.

The trust is upping its bets in the tech hub after acquiring an IT park in the Outer Ring Road in 2023 in a forward purchase deal valued at $152 million. CLINT’s other properties under development in Bengaluru are two office buildings at Gardencity, an IT park in Hebbal with a net leasable area of up to 1.65 million square feet; Ebisu, a 1 million square foot IT park in the Outer Ring Road; and a data centre.

CLINT’s portfolio size, inclusive of committed investment pipeline, will grow 4 percent to 31.47 million square feet with the acquisition of the office project. At the end of December, the REIT’s assets under management stood at S$3.7 billion (now $2.8 billion).

Multi-Year Roadmap

CapitaLand Investment last September announced a plan to more than double its S$7.4 billion in funds under management in India by 2028, with a focus on expanding its core businesses of IT parks, logistics assets and data centres in the country.

Last month, CLINT announced plans to begin the second phase of redevelopment of a tech park in Hyderabad at an estimated investment of INR 4.5 billion ($52 million), following through on a plan introduced when the first phase of the office project was launched two years earlier.

The redevelopment news came eight months after the REIT inked a forward purchase agreement with longtime partner Phoenix Group for the development and acquisition of 2.5 million square feet of Hyderabad office properties.

Last March, CLINT acquired the first phase of a 1.4 million square foot office project in Pune for S$124.6 million. Four months later, the trust completed the S$109 million acquisition of an office building in Navi Mumbai.