The Xander Group, which owns a portfolio of 66 million sq ft worth real estate assets in India, is looking to scoop up more across the retail, commercial and residential segments, the founder of the global investment firm said.
“We are the largest institutional owner of real estate assets in India excluding road and highway assets,” Siddharth Yog told ET.
“We as a fund like the safety of investing in a country that is driven by demand and consumption. It is an interesting time in different cities in India.Opening up of FDI (foreign direct investment) can help us increase the business further and buy assets and increase value in those assets.”
The government recently removed restrictions on FDI into the sector, except keeping a three-year lock-in period for select cases. There will now be no lock-in period for FDI investments in hotels and resorts, hospitals, special economic zones, educational institutions, old-age homes and NRI investments, allowing for greater and smoother flow of foreign money into these categories.
The fund is now looking to buy income-generating, commercial office assets in top Indian cities. It has reached a deal with an investor consortium led by Dutch pension fund asset manager APG Asset Management NV to invest $300 million (Rs 2,000 crore) jointly .”We will also look at buying grade-B office space and upgrade it if there is value in it. We have further expanded our partnership with the investors,” Yog said.
Yog founded Xander in August 2005 and raised $120 million for his maiden realty fund. Now, it manages equity capital in excess of $2 billion in India. As a strategy, Xander is also looking to rope in strategic investors to double its retail portfolio, Virtuous Retail.This will be a precursor to a public listing of the platform.It is looking to expand into markets like Mumbai, the NCR and Kolkata apart from its existence in Bengaluru, Pune, Chennai and Surat.
“We are always in talks with potential investors. At any given time we are investing, returning and exiting. We may also look at listing it in India if the REIT law happens in India.We have an option to list in Sin gapore as well,” said Yog.
Xander formed Virtu ous Retail in 2007 as a stan dalone develop ment and oper ating platform for retail assets and has devel oped 5.5 million sq ft of malls in the country .
Xander’s retail d has invested dedicated fund has invested more than Rs 2,500 crore in this venture. The company plans to build or acquire malls of 1 million sq ft in the top 10 cities of the country and smaller neighbourhood community centres of 1,50,000-200,000 sq ft in smaller cities like Lucknow, Jaipur and Bhubaneshwar.
“The relaxation of FDI (rules) now opens up the gamut for us to build smaller shopping centres, which was not allowed earlier,” Yog said. The company has appointed Morgan Stanley to advise it on scaling up the business in India.
Separately, the company’s non-banking financial unit, Xander Finance, and Xander Opportunity fund IV are looking to increase investment in the residential, infrastructure and manufacturing sectors.