Singapore's sovereign wealth fund GIC and ESR Group Ltd, on Thursday announced forming a $600 million joint venture in a bid to acquire income-producing core industrial and logistics assets in India.
GIC will hold an 80% stake in the JV and ESR - Asia Pacific-focused logistics real estate platform backed by private equity firm Warburg Pincus - will own 20%.
The new core JV aims to provide focused capital for investments into core industrial and logistics assets in India. The JV is an extension of the existing partnership in India between the two, which was initiated in 2020, with the initial capital pool dedicated to investing in development and value-add logistics and industrial opportunities across India.
The new JV provides focused capital dedicated to enabling the inorganic growth of the platform and will invest in stabilised operational assets in strategic locations across Tier I and Tier II cities.
"Capital partner support has been key to the growth of ESR's new economy real estate platform. This stems from our long and deep strategic relationship, covering multiple geographies and funds. As APAC's largest real estate asset manager, ESR's integrated fund management platform has provided our capital partners with access to some of the world's best secular growth opportunities propelled by the positive trends of e-commerce and digital transformation,” said Jeffrey Shen and Stuart Gibson, ESR Co-founders and Co-CEOs, in a joint statement.
They added, “These trends open new investment opportunities to ESR and our capital partners as the demand for advanced, large-scale, well-located logistics and industrial assets becomes even greater.”
The firms stated that investments in enabling sustainable infrastructure are critical to the country's development. With the upsurge in the share of organised retail and ecommerce, supported by emerging sectors such as electric vehicles and semiconductors, the industrial and logistics asset class is expected to outperform other real estate and infrastructure asset classes in the medium term.
“With the Core JV platform, we will upgrade the assets as required, and add sustainability elements, to ensure that we offer the same product quality to our customers as we do for products that we develop ourselves,” said Abhijit Malkani, chief executive officer of ESR India.
ESR India, part of the ESR Group, has assets under management of approximately $1.7 billion and over 18 million sq. ft. of gross floor area.
