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GIC, ESR form JV to invest $750 mn in logistics assets

Both parties have entered into an 80:20 strategic partnership and will invest in India

Singapore-based sovereign wealth fund GIC and Hong Kong-based logistics developer ESR Cayman have announced a $750 million joint venture (JV) to develop and acquire industrial and logistics assets in India, media reports said. Both parties announced that they have entered into an 80:20 strategic partnership.

The new joint venture formed by GIC and ESR Cayman will focus on Tier 1 and Tier 2 cities across India. To begin with, the JV will invest in a 2.2 million sq ft build-to-core asset, located around Mumbai.

Kishore Gotety, co-head (Asia ex-China) of real estate at GIC told the media, “Continued ecommerce growth in India over the long term, reinforced by rising internet penetration, is expected to drive strong demand for industrial and logistics assets. This is further supported by the emphasis on infrastructure development, changing supply chains, and low vacancy levels. This JV is well-positioned to benefit from these tailwinds, bring institutional-grade assets into this market, and generate resilient returns.”

The Government of Singapore Investment Corporation, formally known as GIC, is also expanding its reach in the European logistics and warehousing space through another joint venture. The joint venture is an establishment between GIC and logistics investment manager Melcombe Partners. GIC plans to acquire and develop last-mile distribution centres and urban logistics assets on the continent.  It is reported that the financial terms of the venture have not been disclosed. In recent years, GIC has been actively participating in acquisitions of global logistics assets.

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