Bengaluru-based real estate developer RMZ Corp. is set to embark on a significant diversification strategy, with plans to invest approximately $7 billion in equity. The investment will be directed towards expanding its core commercial office business and venturing into four new asset classes: industrial and logistics, hospitality, mixed-use, and luxury residential development.
The ambitious investment plan aims to raise part of the funds from institutional investors, with the remaining portion funded through the company’s capital reserves. RMZ Corp. envisions creating assets under management worth $25 billion over the next five years across various real estate businesses.
Arshdeep Sethi, President of RMZ Real Estate, highlighted the company’s intention to invest the capital strategically, stating, “We will invest the capital to create assets under management worth $25 billion in the next 5 years across various real estate businesses.”
Existing investors in RMZ include Canada’s CPP Investments and Japan’s Mitsui Fudosan Asia Pte. Ltd, both of whom have supported the developer’s projects in recent years.
The diversification plan involves the creation of new business verticals, each focusing on different aspects of real estate:
- Mixed-Use Development: RMZ’s mixed-development business vertical will undertake city-centric projects in Mumbai, National Capital Region (NCR), and Bengaluru. These projects, ranging from 1-5 million sq ft, will include a combination of office space, hotels, retail, and residential components. The goal is to develop approximately 15 million sq ft across 3-4 projects in the next five years, with a gross asset value of $8 billion.
- Logistics: RMZ plans to develop large warehouses, building a portfolio of 60 million sq ft in the coming years. The logistics vertical may also explore in-city or urban logistics at a later stage.
- Hospitality: The company aims to develop hotels, including standalone leisure properties and business hotels that could be part of its mixed-use projects.
- Residential Development: After focusing primarily on office projects, RMZ is re-entering the residential development space, particularly targeting luxury housing in Mumbai and Delhi-Gurugram.
RMZ currently has 21 million sq ft of office projects under construction, with plans to add another 30 million sq ft in the next two to three years. The company remains optimistic about the future of the commercial office sector, emphasizing the continued leasing momentum in its projects.
The $7 billion investment signals RMZ Corp.’s strategic move to diversify its real estate portfolio, aligning with its vision to navigate the evolving real estate landscape and capitalize on emerging opportunities in different asset classes. The company’s commitment to creating a substantial asset base underscores its confidence in the long-term growth and resilience of the real estate market.