Bengaluru: RMZ Corp. plans to invest about $7 billion equity, as the Bengaluru-based real estate developer diversifies into four new asset classes – industrial and logistics, hospitality, mixed-use and luxury residential development. The capital will also be used to expand its core commercial office business.
RMZ will raise part of the $7 billion of investment planned from institutional investors, and the remaining would be funded by the company’s capital reserves.
“We will invest the capital to create assets under management worth $25 billion in the next 5 years across various real estate businesses,” Arshdeep Sethi, president of RMZ Real Estate, said in an interview.
RMZ’s existing investors include Canada’s CPP Investments and Japan’s Mitsui Fudosan Asia Pte. Ltd, who have funded its projects in recent years.
Under the new mixed-development business vertical, RMZ is looking to do city-centric projects in Mumbai, National Capital Region (NCR) and Bengaluru. A typical mixed-use project, each ranging 1-5 million sq ft, will have a combination of office space, hotel, retail and residential components, said Avnish Singh, CEO, RMZ Mixed- Use. Over the next five years, this vertical will develop about 15 million sq ft, across 3-4 projects, with gross asset value of $8 billion.
Under the logistics vertical, the company is looking to develop large warehouses and will steadily build a 60 million sq ft portfolio in the coming years, said Avinash Sule, CEO of the logistics and hospitality business. It may also do in-city or urban logistics at a later date. RMZ will also develop hotels, including standalone leisure properties as well as business hotels that could be part of its mixed-use projects.
After focusing on developing office projects in recent years given the momentum in the commercial office sector pre-covid, RMZ is also making a return to residential development. Given that luxury housing has seen huge momentum in the last couple of years, the developer is eyeing residential projects in Mumbai and Delhi-Gurugram, said Saandip Kundu, CEO, RMZ Living.
RMZ currently has 21 million sq ft of office projects in various stages of construction. The developer plans add another 30 million sq ft or so, in the next two to three years, to have an office portfolio of 50 million sq ft in six cities.
Thirumal Govindraj, CEO, RMZ Office said the company is positive about the future of the commercial office sector.
“…Large lease deals of 300,000-400,000 sq ft may have slowed down, but we have witnessed good leasing momentum in our projects. A lot of smaller deals are happening, where a number of companies are setting up their first global capability centres (GCC) in India which is encouraging,” Govindraj said.
Bengaluru-based RMZ is a privately-owned company by Raj and Manoj Menda, who are chairs of the supervisory board.
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Updated: 22 Nov 2023, 06:52 PM IST