Brookfield India REIT to acquire Bharti Enterprises’ stake in top realty assets

Brookfield India Real Estate Trust (BIRET) has signed binding agreements to acquire Bharti Enterprises’ 50% stake in four Grade A assets in Delhi-NCR, the companies said in a joint statement on Thursday.

The acquisition includes 3.3 million sq. ft of commercial properties at an enterprise value of ₹6,000 crore. The total equity consideration for the 50% stake will be fulfilled through a preferential allotment of units in BIRET to Bharti, at ₹300 per unit.

Following this, Bharti will become the second-largest unitholder in BIRET, Canadian institutional investor Brookfield’s listed REIT in India, with an 8.53% stake.

Last year, Brookfield Asset Management in a transaction had picked up around 50% stake in Bharti Enterprises’ four commercial properties in Delhi-NCR. With the latest acquisition, Brookfield India REIT and Brookfield Asset Management will together own the joint venture called Rostrum Realty.

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The portfolio of assets includes operating Worldmark assets at Aerocity New Delhi, a mixed-use property covering 1.4 million sq. ft, Airtel Center, a corporate facility of 700,000 sq. ft in north Gurugram, and Worldmark Gurugram, a 700,000 sq. ft mixed-use asset.

In a statement detailing its earnings, BIRET also said that Brookfield, through its private real estate fund, will continue to own the remaining 50% stake that it purchased in April 2023. “Brookfield India REIT will have a right of first offer to acquire the 50% stake (after April 2026) and consolidate to 100% ownership,” it said.

This acquisition will increase Brookfield India REIT’s operating area by 16% and consolidated gross asset value by 22% through the addition of modern assets with marquee front office tenancy.

“With this acquisition, we add New Delhi to our portfolio making BIRET the most diverse office REIT in India. These high-quality assets with strong tenancy also increase our retail operating area to 1 million square feet,” said Ankur Gupta, managing partner, head of real estate for the Asia Pacific region, Brookfield.

Brookfield India REIT comprises six large office parks located in Mumbai, Gurugram, Noida, and Kolkata. The Brookfield India REIT portfolio consists of 25.5 million sq. ft of total leasable area, comprising 20.9 million sq. ft of operating area, 0.6 million sq. ft of under-construction area, and 4 million sq. ft of future development potential.

Harjeet Kohli, joint managing director, Bharti Enterprises, said, “With this transaction, Brookfield, through its two managed vehicles, will own 100% stake in the four marquee assets originally developed by Bharti Realty. With an over 8.5% stake in the REIT, Bharti is excited to take its partnership with Brookfield forward.”

Bharti also continues to invest in a large development pipeline of over 10 million sq. ft of Grade A commercial real estate assets in Aerocity, New Delhi, and hopes to grow this partnership through similar transactions, Kohli added.

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Brookfield India Real Estate Trust's adjusted net operating income for the quarter ended March grew by 89% year-on-year to ₹460.80 crore. For the financial year ended March 31, 2024, the company's adjusted net operating income grew 57% to ₹1,506.2 crore.

The company’s gross asset value grew by 78% year-on-year to ₹29,200 crore.

“FY2024 was our best year since our IPO, driven by a broad-based recovery in leasing demand across sectors and a strong preference for our sustainability-focused Grade A assets. We have already achieved 40% of our new leasing guidance of 2.0 - 2.4M sq. ft till FY2025,” said Alok Aggarwal, chief executive officer and managing director, Brookfield India Real Estate Trust.

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