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India’s Largest Real Estate Developer DLF to build Country’s Largest Mall in Gurugram; in collaboration with GIC

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India’s largest listed realty developer DLF recently joined hands with Singapore’s sovereign wealth fund GIC to make their strategic business relationship even more stronger by rolling out a new project to build the country’s biggest retail mall of more than 2.5 million sq ft.

The new mega real estate project, a retail and commercial-led mixed-use development to be known as Down Town, will be constructed on a 23-acre land area owned by DLF in Gurgaon. The plot is situated on the highway opposite DLF’s 2.5 million sq ft commercial project Cyber Park.

DLF enters into Joint Venture with Hines will invest Rs 1,900 crore to develop 2.9 million sq ft commercial project in Gurugram

“The retail mall will be part of this 8 million sq ft project that will also have component of serviced apartments, five-star hotel and commercial development. The project will be developed in two-three phases in more than five years,”.

The new project development to be executed through DCCDL, and is expected to surpass the country’s current largest retail development 2.5-million-sq-ft LuLu International Shopping Mall in Kochi and DLF’s own 2-million-sq-ft Mall of India in Noida.

The DLF-GIC joint venture was articulated in end of 2017 after the promoters of the realty firm K P Singh and his family had sold their stake in rental arm DLF Cyber City Developers Ltd (DCCDL) to the Singapore investment firm.

Under the agreement with GIC, DLF can sell completed, yielding commercial projects to this joint venture or build-to-suite yielding commercial assets for this entity. It can also sell land parcels earmarked for commercial development in the near future to this joint venture.

DLF has already identified certain assets and land parcels for transfer to DCCDL and has been in talks with GIC for the same.

As part of business deal between DLF and GIC in end of 2017, the promoter family had sold the whole 40% stake in DCCDL for Rs 11,900 crore or $1.9 billion. This arrangement included clearance of 33.34% stake in DCCDL to GIC for Rs 8,900 crore or $1.4 billion and buyback of the rest of the offers worth Rs 3,000 crore or $0.5 billion by DCCDL.

Worldwide private fund players,including Blackstone Group, Canada Pension Plan Investment Board (CPPIB), APG Asset Management, Xander Group and GIC, have begun putting resources into the retail sector to differentiate their investment portfolios in the nation and more assets are looking at such coalition opportunities.

In one of India’s biggest transactions to help build a property investment platform, private equity player Warburg Pincus a month ago went into a $1-billion coalition with Mumbai-based real estate developer Runwal Group to fund retail-led mixed-use projects across the country.

Renting activities in real estate retail segment has been on the massive rise and a few unmistakable shopping centers are seeing powerful demand for more space from leading brands.

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