Mitsubishi Corporation, Japan’s largest trading company, has reportedly ventured into the Indian real estate business with an investment of approximately Rs. 1.8 billion, with an underdevelopment residential project by Shriram Properties in Chennai. According to terms of the agreement, Mitsubishi would hold a 70% stake in this residential project called “Shriram Park 63”.
According to sources familiar with the matter, the two organizations have signed definitive contracts to endorse the residential project, spanning 63 acres.
A report by Livemint claims that previously, Starwood Capital, Tata Capital, TPG, and Street Capital had also ventured into the realty sector by joining forces with Shriram, for their first ever real estate gig.
Kentaro Koga, GM, Myanmar/India, Real Estate Business of Mitsubishi and Chief Executive Officer of DRI India Co. Ltd. (its investment wing), was quoted stating that the company is looking forward to work with such reputable partners in a prime sector like real estate. Mitsubishi expects that Shriram’s established brand name, project execution and delivery record, and emphasis on customer value would fuel their growth aspirations, Koga added.
For the uninitiated, Shriram has practiced the partnership model for fast-tracked development in various past and current projects. Previously, it had partnered with numerous marquee investors like Amplus Reality, ICICI Prudential, ASK Property Investment, Hypobank, Xander, Motilal Oswal, and Sun Apollo. Sources claim that the Mitsubishi collaboration is an extension of the same strategy and is intended to leverage the strengths of both participants for superior value.
According to sources familiar with the development, Shriram Park 63 is being built on a prime land located at GST Road, Chennai, comprising of over 1450 residential units, and 2 million sq. ft. of saleable area. Reportedly, Shriram has made pre-sales of more than 25% of the project, which boasts of a potential of over INR 10 billion in the next 3-4 years tenure.