Blackstone and Brookfield are going mall shopping in India

Real estate giants are in talks to buy stakes in half a dozen shopping centers

New York Weekend Edition /
Aug.August 16, 2020 12:00 PM
Brookfield’s Bruce Flatt and Blackstone’s Jonathan Gray

Brookfield’s Bruce Flatt and Blackstone’s Jonathan Gray

Blackstone Group and Brookfield are shopping for retail opportunities overseas.

The two real estate giants are among investors competing to buy up Indian retail assets struggling amid the coronavirus pandemic, according to Bloomberg.

They are in talks to buy stakes in six Indian malls — including DB Mall in the city of Bhopal and Logix Mall outside New Delhi — with the purpose of establishing retail real estate investment trusts. Blackstone has also been in discussions with the owners of Chennai’s Marina Mall. The Economic Times first reported on the companies’ interest in the properties.

Blackstone has already had some success with REITs in India. One of the REITs it backs, Mindspace Business Parks REIT went public in late July and shares have gained as much as 12 percent in its debut on Mumbai’s stock exchange.

Revenues for mall operators in India are expected to halve between March 2020 and March 2021, according to a Crisil Rating report published last week.

It’s a similar story for malls across the globe, which are struggling thanks to coronavirus-induced closures. In the U.S., landlords reported losses in the second quarter, and some have been battling over unpaid rent with tenants.

In May, Brookfield Property Partners launched a $5 billion fund dedicated to investing in U.S. retailers suffering because of the pandemic. In an interview with The Real Deal in June, CEO Brian Kingston described the move as “a classic Brookfield approach to investing.”

“We try to be contrarian, and we try to invest our capital in places and at times when capital is scarce,” he said. “That’s a very apt description of retail businesses right now.” [Bloomberg]Dennis Lynch


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