GIC Real Estate set for big role in India

GIC Real Estate, the real estate investment arm of the Government of Singapore Investment Corporation, is charting out a larger game plan for India.

According to industry sources, the firm which manages a multi-billion dollar portfolio of direct and indirect property investments with over 200 investments in over 30 countries is singling out a sharp focus to leverage on the growth options that Indian real estate market offers.

GIC is understood to be closing two private equity deals in the present quarter. In addition to this, the company will start looking actively at the hospitality sector in the near future.

To facilitate this, Reco Hotel, an affiliate of GIC Real Estate has formed a joint venture with Host Hotels & Resorts of US to explore investment opportunities in Asia and Australia.

The partners have agreed to invest a maximum of $600 million of equity in the joint venture, which combined with the anticipated leverage provides total investment potential of $1.5 billion to $2 billion.

A spokesperson for GIC Real Estate said there are increasing investment opportunities in both emerging and developed markets to build a substantial portfolio of hospitality-related assets in Asia. According to data from Venture Intelligence, a venture capital research firm in India, close to $300 million was invested in hospitality sector over the last year, doubling from the previous year.

Indian hospitality companies like Leela Hotels & Resorts, Lemon Tree besides a few others had earlier absorbed private equity from funds like IDFC and Kotak. Royal Orchid Hotels is another Bangalore-based hospitality player expected to close a Rs 600 crore private equity deal during this quarter.

According to industry information, Puravankara Projects is also expected to go in for a PE play to establish its hospitality wing. While GIC is starting to get active in the Indian real estate sector, another of its global peers Hypo Real Estate of Germany is understood to have made two investments in India.

Hypo, according to industry sources has invested Rs 600 crore into projects of Shriram Properties and Tanglin Development, an arm of Amalgamated Bean Coffee.

GIC Real Estate set for big role in India