Phoenix Mills and Canada Pension Plan Investment Board (CPPIB) have entered into a new joint venture for an office-led mixed use development project at Lower Parel in Mumbai.
The development size of the project is approximately 1.2 million square feet- it comprises of offices of about a million square feet and retail of about 200,000 square feet.
CPPIB will invest around Rs 1,350 crore in tranches and the project is expected to be complete by 2026.
In an interview with CNBC-TV18, Shishir Shrivastava, Managing Director at Phoenix Mills, discussed the project.
“For this investment, CPPIB will acquire about 49 percent stake in that specific asset,” he said.
There is going to be upstreaming of some capital, which will increase the liquidity at Phoenix Mills to the extent of about Rs 670 crore and the balance funds will be adequate to complete this project on an unlevered basis, he shared.
“So there is no further capital commitment by Phoenix Mills to complete this project. The funding provided by CPPIB is adequate. We have liquidity of about Rs 1,900 crore at Phoenix Mills. So at present, we are very liquid and poised for growth,” Shrivastava mentioned.
At present, GIC has acquired a partial stake in two assets. “They will, in all likelihood, move up to 35 percent in our mixed use development project in Mumbai at Kurla, and in the mall that we have at Viman Nagar in Pune. That has also created additional liquidity at Phoenix,” he explained.
According to Shrivastava, consumption across the malls in the month of October and November has been spectacular. He remains confident about the performance of the retail mall business.
“In October, we saw consumption of about Rs 660 crore across the malls, which is about 90 percent of where we were pre-pandemic. In the month of November so far, we have seen consumption in excess of Rs 450 crore, which is about 15 percent higher than the same period in November 2019, which again is pre-pandemic. We continue to remain confident about the performance of our retail mall business,” he stated.
For the full interview, watch the accompanying video.
Catch all market updates here.