Embassy REIT is exercising its right under the rights of first offer (ROFO) agreement to acquire the realty asset
Embassy REIT, a publicly-listed REIT, on Tuesday announced it has agreed to purchase Embassy TechVillage’s assets from affiliates of Embassy Sponsor, Blackstone Sponsor and other selling shareholders for a total consideration of ₹9,782.4 crore ($1.3 billion), subject to regulatory approvals.Embassy REIT is exercising its right under the rights of first offer (ROFO) agreement to acquire the realty asset. The acquisition comprises 6.1 million square feet of completed area, 3.1 msf of under-construction area, of which 36% is pre-leased to JP Morgan, and two proposed 518-keys Hilton hotels within the overall ETV campus.Speaking to the media in a virtual meet Mike Holland, Chief Executive Officer of Embassy REIT said, “ETV is a unique large scale business park, in the Outer Ring Road sub-market of Bengaluru, with a diversified blue-chip and predominantly multinational occupier base, including JP Morgan, Cisco, Sony and Flipkart. The acquisition deepens our presence in Bengaluru, which remains India’s strongest office market”. The REIT proposes to fund this Rs 9800 crore acquisition by issuing equity of ₹6,000 crore billion through a combination of an institutional placement of ₹3,700 crore, and by way of a preferential issue of units to third-party selling shareholders of ₹2,300 crore, as per the company.Jitendra Virwani, Chairman & Founder of the Embassy Group said, “Embassy Group will continue to develop top quality office assets across the country, thereby providing the REIT with a potential pipeline of assets that will help it grow inorganically over the coming years”.Responding to a media query on the impact of work-from-home on commercial realty, Mr. Holland said, the sector was still growing in the Asian markets with India and Bangaluru leading the wave.