As India Realty Sector Defies Global Slowdown, A Big Player Makes A Move

The billionaire family behind a property empire is opening up to outside investors for the first time as India's real estate sector proves a bright spot in a global slowdown.

The Reddy family's GAR Corporation is looking to raise as much as $200 million from family offices and sovereign wealth funds by selling a minority stake in one of Hyderabad's biggest commercial developments, according to people with knowledge of the matter.

The twin towers being offered in GAR's Infobahn business park have 3.5 million square feet of rentable space across two interconnected buildings spanning about 27 floors, with roughly a quarter of the space already listed as leased to tenants. The glass-encased buildings also have a central food court, gym and day-care centre.

The Reddy family has a net worth of more than $1 billion from Hyderabad-based GAR, which owns more than a dozen office blocks in the city, according to the Bloomberg Billionaires Index.

A representative for GAR didn't respond to a request for comment.

India's commercial real estate market has so far defied a global downturn that followed a rise in interest rates aimed at curbing inflation.

Vacancies in the country's office market this year through June fell to the lowest level since the second half of 2020, according to real estate broker Knight Frank, highlighting the sector's resilience. Hyderabad, one of the country's fastest-growing cities, also saw rental growth during the same period in the business district where Amazon.com Inc. and Microsoft Corp. both have major offices.

Gavva Amarender Reddy, 62, founded the business bearing his initials in the early 1980s, attracting global companies, including HSBC Holdings Plc, PepsiCo Inc. and Capgemini SE as tenants. He now serves as chairman of the closely held firm while his son, Abhinav, 33, is managing director. GAR also has extensive land holdings in India totalling about 20 million square feet.

GAR is selling a stake of at least 30% in towers eight and nine on the Infobahn project, said the people, who asked not to be identified as the details are private. The Reddy family, which wholly owns GAR, would likely use the money to diversify their wealth and develop more property, though no final decision has been made, they said.

The company has already built at least a half-dozen buildings in the business park with a handful of others under construction.

Participant Capital, an advisory firm for family offices and institutional investors, is assisting GAR's fundraising efforts, the people said. A Participant representative declined to comment.