BENGALURU: Southern developer Embassy Group is close to signing a deal with Cornerstone, one of the largest land owners, to lease 150 acres for building a 3.5 million sqft warehouse project at Hoskote.
Billionaire Jitu Virwani led Embassy, which moved into the warehousing sector by forming a JV with private equity Warburg Pincus last year, will have 70% economic interest in the project with Cornerstone owning the rest, according to sources familiar with the matter. The transaction is done “in principal,” they said adding the deal will be signed in a month once the commercial aspects of it are fine-tuned.
The warehousing project is expected to attract major e-commerce players as they rapidly expand in the country and a spurt in manufacturing on account of the Make in India campaign. A source said Flipkart already held talks with the Embassy to occupy about 1-2 million square feet space in the warehouse over the next four years. Flipkart did not respond to requests for comment.
E-commerce today accounts for about 25% of all warehousing absorption in India. The industry may invest an additional $2 billion to $3 billion in warehousing over next 2-3 years. Flipkart has 17 warehouses across India covering 1.5 million sqft, while Amazon has 21 with almost 2 million sqft space.
Credits ET Realty