ICICI Prudential AMC Invests Rs 177 Crore in Pune Office Space, Leases Back to WNS Global
ICICI Prudential AMC's Office Yield Optimiser Fund has acquired 1.7 lakh square feet of office space in Magarpatta Cybercity, Pune, from IT firm WNS Global for Rs 177 crore. The property is leased back to WNS Global, signaling a growing trend of sale-and-
Real EstateInvestmentIcici Prudential AmcSaleandleasebackWns GlobalReal EstateFeb 26, 2025
The 1.7 lakh square feet of office space, located in Magarpatta Cybercity, was acquired from the IT services firm WNS Global for Rs 177 crore.
The property has been leased back to WNS Global for a starting rental of Rs 16 crore per year, according to sources familiar with the matter.
Sale-and-leaseback deals like this one are becoming more common in the real estate industry, particularly as they offer long-term, healthy yields that attract institutional investors.
The investment was made through a special purpose vehicle (SPV) that the fund holds shares in.
ICICI Prudential AMC is actively building a portfolio of rent-yielding commercial assets, focusing primarily on office spaces.
The fund aims to raise around Rs 2,000 crore, with the capital-raising process currently underway.
The fund is targeting a yield of approximately 9 percent from the WNS Global transaction.
According to documents accessed by Propstack, WNS Global sold the property at a rate of around Rs 10,300 per square foot.
The lease agreement includes a starting rate of Rs 77.50 per square foot per month, with a 5 percent escalation every year over the five-year tenure, which is locked in.
This arrangement allows WNS Global to continue using the property while freeing up capital that can be used for other business purposes.
Sale-and-leaseback arrangements are relatively common in sectors such as aviation and hospitality.
However, in commercial real estate, these deals are still relatively rare.
The advent of publicly-traded real estate investment trusts (REITs) has brought large equity and debt players into the segment, driven by strong leasing activity in major markets.
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Frequently Asked Questions
What is a sale-and-leaseback arrangement?
A sale-and-leaseback arrangement is a financial transaction where a company sells an asset, typically a property, to a third party and then leases it back under a long-term lease agreement. This allows the company to free up capital while continuing to use the asset.
What is the purpose of a special purpose vehicle (SPV)?
A special purpose vehicle (SPV) is a legal entity created by a parent company to isolate financial risk. It is often used for specific projects or investments, allowing the parent company to keep the risks and liabilities separate from its core operations.
Why are institutional investors attracted to sale-and-leaseback deals?
Institutional investors are attracted to sale-and-leaseback deals because they offer stable, long-term rental income and strong yields. These arrangements provide a predictable cash flow, which is particularly appealing in the current economic climate.
How does the advent of REITs impact the commercial real estate market?
The advent of real estate investment trusts (REITs) has brought large equity and debt players into the commercial real estate market. REITs allow investors to pool their resources to build portfolios of rent-yielding properties, providing a reasonable value addition due to long-term committed leases and strong yields.
What is the significance of the WNS Global deal for ICICI Prudential AMC?
The WNS Global deal is significant for ICICI Prudential AMC as it marks another strategic investment in their portfolio of rent-yielding commercial assets. The fund is targeting a yield of around 9 percent from this transaction, aligning with their goal to build a robust portfolio of office spaces.
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