GIC and ESR form US$600 million JV to invest in India

GIC and ESR form US$600 million JV to invest in India
ESR Nagpur Logistic Park

Logistics and industrial assets in Tier 1 and Tier 2 cities are to be acquired.

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Singapore’s Sovereign Wealth Fund, GIC, and Hong Kong-based ESR Group have partnered to establish a US$600 million (S$850 million) joint venture to acquire logistics and industrial assets in India.

The venture, in which GIC owns 80 percent, is an “extension” of the December 2020 US$750 million partnership between the two entities.

According to ESR, the new JV will provide capital to invest in “stabilised operational assets” in locations across Tier 1 and Tier 2 cities of the country.

ESR India’s CEO, Abhijit Malkan, said that India is witnessing supply chain transformation supported by automation, "digitisation, and favourable" government policies.

 “Class-A industrial and logistics developments offer a variety of features to increase operational efficiency,” he added.

A host of Indian corporations, including logistics firm Blue Dart Express and staffing solutions provider Quess have been expanding in metros and smaller cities to tap demand for online shopping according to a Reuters report.

GIS and ESR expect the industrial and logistics asset class to outperform other real estate and infrastructure assets in the medium term with the region witnessing an upsurge in retail and e-commerce.

This development receives further support from emerging sectors such as electric vehicles and semiconductors.

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