Realty firm RMZ Corp has tied up with Canada Pension Plan Investment Board to develop office complexes in Chennai and Hyderabad and the latter will invest Rs 1,500 crore (USD 210 million) in the joint venture.
Bengaluru-based RMZ Corp, which is one of the leading commercial real estate player, said it has entered into a joint venture with Canada Pension Plan Investment Board (CPP Investments) to develop and hold commercial office space in Chennai and Hyderabad.
"CPP Investments will invest Rs 1500 crore (USD 210 million), which will allow for the expected development of 10.4 million square feet of high-quality commercial office sites," RMZ said.
Both the partners will have an equal stake in the JV firm.
The value of the partnership assets, once developed, is estimated to be over USD 1.5 billion, said Manoj Menda, Corporate Chairman, RMZ Corp.
"The partnership with CPP Investments, a globally respected institutional investor, will only strengthen our vision of achieving our hyper-growth strategy target of RMZ 2.0," Menda said.
RMZ is amongst the only zero-debt real estate companies globally, said Arshdeep Sethi, Managing Director, RMZ Corp.
"With equity deals for assets over the last few months, we have ample headroom to achieve our next phase of growth," he said.
The three sites that form this transaction - RMZ Nexity (Hyderabad), RMZ Spire (Hyderabad) and RMZ One Paramount (Chennai) - are Grade-A developments.
Of the 10.4 million square feet included in the transaction, 7.5 million square feet is under active development and construction of the remaining space will commence in the coming months.
"As India continues to be a strong source of global talent, demand for collaborative and engaging work space is expected to grow," said Hari Krishna, Managing Director, Real Estate - India, CPP Investments.
The joint venture is well placed to meet the growing demand for high-quality sustainable office assets in Chennai and Hyderabad, he said.
In December last year, RMZ Corp completed the sale of its large commercial portfolio to Brookfield for USD 2 billion in India's largest real estate deal.
The company utilised half of the proceeds to retire debt and the balance amount is meant for future growth.
RMZ group sold 12.8 million sq ft of 67 million sq ft (about 18 per cent) of their real estate assets to a fund managed by Brookfield Asset Management.