Brookfield buys 51% stake in four Bharti Enterprises assets

In a landmark deal, Brookfield of Canada and Bharti Enterprises have entered into a joint venture to jointly develop 4 properties of Bharti Enterprises. These properties will include the Worldmark Aerocity  in Delhi, the Worldmark 65 and the Airtel Centre in Gurugram and the Pavilion Mall (Ludhiana).

The deal is worth an enterprise value of Rs.5,000 crore. All the 4 are commercial properties and Brookfield has one of the largest realty portfolios in India.

Once these four properties are moved into a joint venture between Brookfield of Canada and Bharti Enterprises, Brookfield will hold 51% in the joint venture while Bharti Enterprises will continue to hold the balance 49%.

Brookfield, which is one of the one of the biggest property portfolio owners in India, will then look at ways and means of monetizing these four properties. If successful, this deal could become the template for the future.

Brookfield will bring in its real estate portfolio management skill to this joint venture. Brookfield Properties, the real estate operating arm of Brookfield of Canada, will manage these 4 properties situated in North India.

These four properties spread across Delhi, Gurugram and Ludhiana is spread across a total area of 3.3 million SFT. While both the companies are agreeable, necessary regulatory approvals are currently awaited.

Out of the total of 3.3 million SFT of property area under management, nearly 1.43 million SFT is accounted for by Worldmark Aerocity in Delhi.
 

This property has an impressive tenant roster comprising financial services firms, global conglomerates and government undertakings.

Airtel Centre is spread across a total area of 700,000 SFT and is a corporate facility in Gurugram while Worldmark 65 is also a 700,000 SFT mixed-use asset class.

For Brookfield, this will be a logical addition. It currently owns and operates about 47 million SFT of commercial real estate properties spread across Delhi NCR, Mumbai, Bengaluru, Chennai, Pune and Kolkata.

Brookfield has total assets under management (AUM) of more than $20 billion spread across real estate, infrastructure, renewable and private equity. Incidentally, Brookfield also has a listed REIT in India, which is like a realty mutual fund.

For Bharti Enterprises, this helps them to monetize idle real estate assets and also allows them to focus on their core business. Bharti Realty, the real estate arm of Bharti Enterprises, will own and operate its remaining commercial assets, which includes the 10 million SFT upcoming development in Delhi Aerocity.