GIC, ESR form $750 mn JV for Indian industrial, logistics real estate

December 22, 2020: Singapore’s sovereign wealth fund, GIC, and ESR Cayman today announced that they have entered into an 80:20 strategic partnership to establish a $750 million joint venture to develop and acquire industrial and logistics assets in India.

The joint venture will develop and own institutional-grade, state-of-the-art industrial and logistics facilities as well as acquire core assets, focusing on Tier 1 and Tier 2 cities across India. The joint venture will be seeded with a 2.2 million sq ft build-to-core asset, located in close proximity to the large consumption hubs of Mumbai and Thane.

Abhijit Malkani and Jai Mirpuri, country heads, ESR India, said, This strategic partnership provides us with immediate scale to capitalise on the early growth stages of India’s rapidly modernising industrial and logistics landscape and tap high growth potential opportunities and further expand our industrial and logistics portfolio.

Kishore Gotety, co-head (Asia ex-China) of Real Estate, GIC, said, “Continued e-commerce growth in India over the long term, reinforced by rising internet penetration, is expected to drive strong demand for industrial and logistics assets. This is further supported by the emphasis on infrastructure development, changing supply chains, and low vacancy levels. This joint venture is well-positioned to benefit from these tailwinds, bring institutional-grade assets into this market, and generate resilient returns.”

The industrial and logistics segment has emerged to become a key growth driver of India’s real estate industry. A confluence of positive factors – including the continued e-commerce expansion, increasing infrastructure investment, supply chain modernisation, and favourable government policies – will continue to drive the consolidation of industrial and logistics real estate and booming demand for grade A logistics infrastructure across the nation.

Jeffrey Shen and Stuart Gibson, co-founders and co-CEOs of ESR, said, “We have a strong conviction in the growth prospects of India’s logistics real estate. Our seasoned local management team, led by Abhijit Malkani and Jai Mirpuri, will continue to leverage our prime logistics assets, deep market expertise, unrivalled track record in fund management and asset management to reinforce ESR’s robust growth and leading position in the Indian market.”