KSH Infra to develop 10 mn sq ft of warehousing assets in major hubs across India

KSH Infra in talks with PE firms.
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KSH Infra, a Pune-based warehousing and logistics parks developer, informed that it is planning to develop over 10 million sq ft warehouses in Mumbai Metropolitan Region (MMR), Pune, National Capital Region and Bengaluru in phases over the next four-five years.

“We are looking to build a pan-India warehousing portfolio of over 10 million sq ft with a strategic partner. We have identified four key locations in major consumption centres to begin with and some more cities will be covered in the next phase.”

~ Rohit Hegde, managing director at KSH Infra told ET

KSH Infra is in talks with global institutional investors, including private equity and sovereign funds, to set up a dedicated platform for this project.

The company which already counts Hong Kong-based Pacific Century Group, Morgan Stanley and Singapore-based Mapletree Investment Holdings as its key partners, will give a majority stake in the platform to its new strategic investor while KSH Infra will be the execution lead.

The company at present is eyeing to raise around $125 million by the end of December to fund the proposed land acquisitions in the four cities, informed Hegde. He added that the discussions with potential strategic investors are at an advanced stage.

As per the KSH Infra estimates, the 10 million sq ft development will be financed through a total investment of $325 million, including around $125 million for land acquisition. Both the execution and development is estimated to cost $200 million, a large part of which will be funded by project finance from banks and financial institutions.

In June, KSH itself entered into a forward sale agreement with Mapletree for over 700,000 sq ft logistics parks, out of the total 1.2 million sq ft under-development asset in Pune’s Chakan locality. Last year, KSH Group sold 1 million sq ft of infrastructure in Chakan and Talegaon to Morgan Stanley Real Estate Fund for over $45 million.

Since the outbreak of the COVID pandemic, investments in warehousing sector has been upbeat and is expected to maintain the trend in the post COVID era as well.

Keen interest of global players and investors in this space is indicated by nearly $7 billion that various platforms have raised for the warehousing sector since 2015.

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