Milestone exits investment in commercial property for Rs 91cr

Private equity player Milestone Capital Advisors today exited its investments in a commercial property in Kolkata for realisation of over Rs 91 crore.
The company has exited its investment of Rs 57 crore made in March 2008 in one lakh sqft commercial property 'Millennium Tower-I' in Kolkata, fully occupied by IT giant IBM, for over Rs 91 crore, Milestone said in a statement.
Milestone had made this investment through its fund- 'IL&FS Milestone Fund I', a commercial rental yield fund investing in ready pre-leased commercial assets.
"We are happy to conclude this exit especially in a difficult real estate market like Kolkata, which has high vacancy levels and declining capital rates. This exit is an example of Milestone's full cycle capability of fund raising, deployment and exits," firm's Executive Vice Chairman Rubi Arya said.

She said the firm has earned a rental yield of 12 per cent per annum, adding, "we have recently renewed the lease agreement with IBM for a long tenure, thereby leading to divesting the asset at an investment multiple of 1.6 times to a high net-worth investor."
Earlier, the company had exited its investment in Acorn Logistics Park in Bhiwandi, Mumbai, at a multiple of 1.6 times, from the same fund, the statement said.

"The deals also indicate a positive HNI outlook towards such quality commercial assets that provide stable rental returns in addition to capital appreciation," she said.
The rental yield funds managed by Milestone cover investments of around Rs 1,200 crore over four million sqft of prime commercial properties, including offices, IT and ITeS parks, logistics and warehousing.

"The funds have consistently have distributed rental yield income to investors and are looking at suitable exit opportunities," the release stated.