Prestige set to seal Rs. 1,800cr SEZ deal

Private equity players of the global repute are currently engaged in negotiations with Prestige Constructions to buy out a special economic zone (SEZ) at an estimated investment of Rs 1,800cr. The SEZ in question, which is called Cessna Business Park with 4.5-million sq ft project housing marquee technology majors like Cisco, as its clients. The rental-yielding fully-developed SEZ on the Sarjapur-Marathalli outer ring road is one of Prestige's landmark commercial space developments. In fact, Prestige recently completed a year of tapping the public markets. It is amongst the few realty developers that have heavily tapped the private equity route for development. Chairman and Managing Director Irfan Razack had recently indicated the company was working on a couple of deals to unlock value for investors.

In addition, the company has so far completed 157 projects, spanning a total development of 44 million square ft across residential, commercial, retail, leisure & hospitality sectors. It is embarking on another 62.29 million sq ft spread over 61 projects. If the on going deal materializes it will be the second major such deal - after global private major Blackstone picked up a significant stake in another tech park developed by the Embassy Group for $200 million. Prior to this, Ascendas India Trust expanded in India to buy five tech park buildings in Phoenix Infocity for Rs 855cr and Kotak Realty Fund exited Peepul Tree Properties to Tata Realty for Rs 525cr. Prestige, which is a South India-focused realty developer, had debt of close to Rs 1300cr at the end of the second quarter of this fiscal. In the last fiscal it posted profit of Rs 200cr on a topline of Rs 1,232cr. It is on track for a total sale of Rs 1,500cr during the current financial year and its rental income is around Rs 150cr, said official sources.