Logistics development platform ESR has acquired around 8 acres of land in Delhi from real estate firm TARC to expand its operations in the city.
The in-city warehouse has a development potential of around 4 lakh sq ft and is located in Alipur, Delhi-NCR.
“TARC wants to completely focus on the upper mid-income and luxury home segments and will cash out non-core businesses,” said a person aware of the deal.
This is the second warehouse asset sale by the real estate firm TARC.
Last year, it sold a warehousing asset in North Delhi to BREP Asia II EIP Holding (NQ) Pte Ltd for Rs 295 crore.
Tarc has been offloading non core assets, including warehousing and retail assets, and is in talks with global funds to offload more retail and warehousing assets.
“The residential market has been performing exceptionally well, and sales have reached an almost 2014 level. TARC wants to fast track the residential projects and reduce debt, ” said another person aware of the plans.
TARC and ESR could not be reached for comment.
The Indian warehousing segment has attracted large institutional investors, allocating fresh capital to the warehousing segment as demand continues to be strong from e-commerce and logistic firms and easing of policies, including the GST reform.
“These sites are well-suited for the mid-mile logistics requirements of large e-commerce tenants. ESR is looking to expand its in-city distribution centers, which are in high demand.The firm is looking to buy both greenfield and brownfield properties not exceeding 15 acres of land area,” said one more person quoted above.
The industrial and logistics real estate platform is looking to step up land acquisitions further to expand its portfolio, as well as build in-city distribution centers, prompted by high demand from e-commerce and retail companies.
ESR has closed two land acquisitions in Gujarat and Chennai last year. In India, it is currently present in nine cities with 16 operational sites and a total gross floor area (GFA) of about 18 million sq ft.