Bengaluru: Real estate firm Sattva Group, backed by American investment firm Blackstone Inc., plans to invest ₹12,000-14,000 crore in the next 2-3 years developing commercial office, residential, and hotel projects, said a top company executive.
Around 40% of the planned investment will be deployed in office projects, 50% in housing development, and 10% in hotel projects across existing cities it operates in, such as Bengaluru, Pune, and Hyderabad. It is also set to enter two new property markets – Chennai and Mumbai, Sattva Group’s managing director Bijay Agarwal told reporters.
The investment will be financed through a combination of equity, debt and internal accruals like sales.
Bengaluru-based Sattva Group has completed roughly 80 million sq. ft of projects across various business verticals. Another 88 million sq. ft is in various stages of planning and development – 23 million sq. ft under construction and 65 million sq. ft in the pipeline.
Sattva and Blackstone have partnered to develop 32 million sq. ft, of which 18 million sq. ft has been completed and the remaining is under development.
It aims to almost double its residential sales from ₹3,500 crore in 2023-24 to ₹6,000-6,500 crore in FY25. On the commercial office front, it is expecting a 20% growth in annuity income from ₹2,000 crore in FY24.
“Up until the pandemic in 2020, our bigger focus was on the commercial office business. However, given the momentum in the residential sector since then, we have witnessed strong sales and have a significant launch pipeline of housing projects. We are also seeing a resurgence and stronger pick-up in office leasing this year,” Agarwal said.
Booming Sector
India’s real estate sector is currently undergoing a housing boom, with developers clocking record growth in sales in the aftermath of the pandemic. The commercial office sector, which went through its share of challenges, also seems to be on a recovery path with leasing picking up and a huge pipeline of projects.
Sattva Group, which counts Google, Novartis, JP Morgan as some of its largest tenants, has around 9 million sq ft of office projects under development in Bengaluru, Hyderabad and Pune. It is launching a 4.5 million sq ft office development in Chennai’s Old Mahabalipuram Road (OMR).
It has residential projects under construction in the southern cities of Hyderabad and Bengaluru, and is planning to enter the Mumbai property market with a 1.3 million sq ft project in the latter half of FY25.
The developer, which has two operational hotels in Kolkata, is also launching a 294-key Taj resort in north Bengaluru, and will also develop and sell 60 Taj-branded villas.
Sattva Group and Pune’s Panchshil Realty, along with Blackstone, have been working together to launch an office real estate investment trust, or REIT, since last year. Bankers have been appointed and the REIT proposal is expected to be submitted later in FY25, said two people familiar with the plans.
Sattva’s Agarwal declined to comment on the matter.
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Published: 25 Jun 2024, 06:19 PM IST