Blackstone Group Lp is scaling up Nucleus Office Parks, an entity that will house its commercial office assets with rental income, to consolidate all its fully-owned properties under a single entity, said a person familiar with the development.
This is in contrast to its larger real estate strategy in India so far, where the private equity giant has acquired commercial office assets in partnership with various developers such as Embassy Group, K Raheja Corp, Salarpuria Sattva Group and Panchshil Realty.
Blackstone is the largest office owner in India with a portfolio of 118 million sq. ft across 44 assets in six cities. Since its foray into the country, the company has invested over $15 billion across sectors such as real estate ($7.8 billion), private equity ($6.9 billion) and tactical opportunities ($400 million).
Blackstone’s assets have a market value of $40 billion in India.
Nucleus Office Parks, which currently has a few properties that Blackstone bought on its own, will expand once the latter buys nearly 16 million sq. ft of commercial assets from Bengaluru-based Prestige Group.
Blackstone is in advanced talks with Prestige to buy rental income assets, including mostly office space, but also a few malls and hotels, for around $1.6 billion.
Once the buyout is complete, a number of Prestige’s office parks and buildings will come under Nucleus.
“The Nucleus platform so far had individual office buildings mainly. But once the Blackstone-Prestige deal is through, the office assets then come under Nucleus, which will become a sizeable entity on its own and will be fully owned and managed by Blackstone," the person cited above said, asking not to be named.
Nucleus Office Parks will become the commercial office equivalent of Blackstone’s subsidiary Nexus Malls that houses its shopping malls in India. A number of shopping malls of Prestige, as part of the deal with Blackstone, will become a part of Nexus.