Singapore's GIC in Discussions to Acquire ESR Group's Warehousing Assets for INR 3300 Cr Approx

According to sources familiar with the situation, Singapore's sovereign wealth fund GIC is in talks with warehousing developer ESR group to acquire a 10 million square foot portfolio of warehouse space for approximately $400 million (approximately Rs 3,300 crore). 

ESR Group seeks to monetize 10 million square feet of space, negotiating with other suitors as well.

ESR group is the largest real asset manager in the Asia-Pacific region and the third largest listed real estate investment manager globally. ESR manages total assets under management (AUM) totaling $156 billion across markets including China, Japan, South Korea, Australia, Singapore, India, New Zealand, and Southeast Asia. With $46 billion in AUM, ESR is also the largest sponsor and manager of REITs in Asia Pacific.

ESR entered the Indian market in 2017 and has a portfolio of 19 properties spanning 20 million square feet in 10 cities. In Delhi, Mumbai, Chennai, Gurugram, Pune, Nagpur, Hyderabad, Ahmedabad, and Howrah, there are ESR warehouses. 

The Indian industrial warehousing market is expanding rapidly due to economic expansion and a dearth of high-quality warehouse assets. 

According to JLL, the stock of warehouses in India's top eight cities has achieved 330 million square feet and is expected to surpass 470 million square feet by 2025. Numerous global entities have invested in the sector because of its growth potential. In February, Allcargo Logistics reached an agreement to sell Blackstone 90 percent of its logistics parks business, comprising 5.5 million square feet of space.

Blackstone partnered with the Hiranandani Group earlier in 2019 to develop warehouses and logistics complexes throughout India.