BIRET to acquire 50pc stake in 4 properties from Bharti Group at Rs 6K cr enterprise value

New Delhi, May 16 (PTI) Brookfield India Real Estate Trust (BIRET) will acquire a 50 per cent stake in four marquee commercial properties from Bharti Group at an enterprise value of Rs 6,000 crore, as part of its strategy to expand its portfolio through inorganic route.

The deal would, in turn, make Bharti Enterprises the second largest unitholder in BIRET with an 8.53 per cent ownership stake. Brookfield, which sponsored the BIRET, is the largest unitholder with more than 40 per cent stake.

"Brookfield India Real Estate Trust has signed binding agreements to acquire a 50 per cent stake in four Grade A assets from Bharti Enterprises. The acquisition includes marquee commercial properties totalling 3.3 million square feet, at an enterprise value of Rs 6,000 crore," BIRET and Bharti said in a joint statement.

The total equity consideration for the 50 per cent stake will be met through a preferential allotment of units in BIRET to Bharti, at Rs 300 per unit. The total equity consideration stands at Rs 1,228 crore.

Almost a year back, Brookfield Asset Management had acquired about 50 per cent stake in Rostrum Realty Pvt Ltd, which owns these four commercial properties including the operational World Mark, and Aetocity in the national capital. Bharti Enterprises had about 50 per cent stake.

Now, Brookfield India Real Estate Trust has acquired Bharti Enterprises' 50 per cent stake in this JV firm Rostrum Realty.

Post this deal, Brookfield Asset Management and BIRET -- both vehicles managed by Brookfield - will have 100 per cent stake.

Bharti will become the second-largest unit holder in BIRET, which is 100 per cent institutionally managed office REIT, with an ownership stake of 8.53 per cent.

Elaborating on the contours of the deal, the joint release said the portfolio of assets includes operating Worldmark assets at Aerocity New Delhi, a mixed-use property covering 1.4 million square feet, Airtel Center, the corporate facility of 7,00,000 square feet in North Gurugram, and Worldmark Gurugram, a mixed-use asset spanning over 7,00,000 square feet.

According to the release, these assets are in established office micro-markets, with excellent connectivity, modern retail and F&B (food and beverages) offerings that create a vibrant live-work-play environment.

In its Q4 earnings release, BIRET said this acquisition will increase Brookfield India REIT’s operating area by 16 per cent and consolidated gross asset value by 22 per cent through the addition of modern assets with marquee front office tenancy.

Brookfield, through its private real estate fund, will continue to own the remaining 50 per cent stake that it purchased in mid-2023 while the BIRET will have a right of first offer to acquire the 50 per cent stake (after April 2026) and consolidate to 100 per cent ownership.

Ankur Gupta, Managing Partner, Head of Real Estate for the Asia Pacific region, Brookfield, said, "We are pleased to extend our partnership with Bharti through this strategic venture making them a significant investor in BIRET." "With this acquisition, we add New Delhi to our portfolio making BIRET the most diverse office REIT in India. These high-quality assets with strong tenancy also increase our retail operating area to 1 million square feet," Gupta added.

Harjeet Kohli, Joint Managing Director, Bharti Enterprises, noted that with the transaction, Brookfield, through its two managed vehicles, will own a 100 per cent stake in the four marquee assets originally developed by Bharti Realty.

"With an over 8.5 per cent stake in the REIT, Bharti is excited to take its partnership with Brookfield forward through a meaningful ownership in their listed portfolio of high-quality assets," Kohli said.

Bharti continues to invest substantially in a large development pipeline of over 10 million square feet of 'Grade A' commercial real estate assets in New Delhi's Aerocity, and hopes to grow this partnership through similar transactions, Kohli added.

In its portfolio, BIRET has six large integrated office parks located in Mumbai, Gurugram, Noida, and Kolkata, comprising 25.5 million square feet of total leasable area. Of this, 20.9 million square feet is operational, 0.6 million square feet of under construction area and 4 million square feet of future development potential. PTI MJH MBI DR