Godrej Fund Management (GFM), the real estate private equity arm of the Godrej Group, has announced the second and final close of its $450-million office development platform named GBTC-I. The platform has partnered with Allianz Real Estate which has committed $150 million to the platform.
Earlier, APG Asset Management had committed $150 million to the platform. GBTC-I which targets the development of premium Grade-A offices in tier one cities in India also has a current pipeline of 1.3 million square feet in Bengaluru. The fund has already secured two developments, one each in Mumbai and Gurgaon, totaling 2 million square feet.
Godrej Fund Management is the real estate private equity arm of the Godrej Group and is a wholly owned subsidiary of Godrej Investment Advisers. GFM manages over $1.6 billion of capital across four funds.
Karan Bolaria, managing director & CEO, Godrej Fund Management, told FE that he expects the full deployment of the fund within 12 months. "The moment we deploy 75-80% of this fund, we will be out raising our next fund which we will be hopefully closing next year . Once the deployment is over, we would need another 12-18 months to finish the overall portfolio," he said.
Baloria also said that outside of the Mumbai and Gurgaon markets, the fund wants to get exposure in Bengaluru and Pune.
"Currently, we have deployed $200 million in Mumbai and roughly close to $100 million in Gurgaon. Close to $150 million will be deployed in Bengaluru and Pune," he said.
Allianz Real Estate pointed out that this investment is part of Allianz's strategy to allocate 50-60% of its real estate exposure within the Asia-Pacific exposure to fast-growing markets such as China and India.
This transaction marks the expansion of Allianz's real estate presence in India. In 2017, Allianz made its first investment in India by establishing an office investment platform with Shapoorji Pallonji, which was followed by a logistics development venture with ESR in 2018.
Rushabh Desai, Asia-Pacific CEO of Allianz Real Estate, said they believe in the long-term growth prospects of the Indian economy. "Strong demographic trends and improving transparency are supporting real estate occupier as well as investor demand, in particular the office sector, which is ideal for long-term institutional investors such as Allianz. We are confident that the platform will deliver upon completion a premium office product that is increasingly sought after by multinational tenants operating in India," he said.