Keppel to Sell One Paramount for Rs. 2,750 Crore

Singapore-based Keppel is set to sell its landmark One Paramount office park in Porur, Chennai, to Prime Offices Fund for about Rs. 2,750 crore. The 2.4-million-square-foot Grade-A property, developed on 12.6 acres, houses marquee tenants such as Genpact, Maersk, UPS, VMware, and Hitachi Energy, underlining its status as a high-quality institutional asset.

The transaction is expected to yield annual rental returns of roughly 7–7.5%, well above typical market benchmarks. Analysts note that these returns reflect not just occupancy stability but also Chennai’s growing appeal as a commercial office destination for global and domestic companies.

Prime Offices Fund, a 50:50 joint venture between Nuvama Asset Management and Cushman & Wakefield India (NCW), has positioned itself as a key player in India’s office investment market. After raising Rs. 1,700 crore at its first close in January, the fund aims to scale up to Rs. 3,000 crore, potentially leveraging up to ?6,000 crore through debt. Its strategy focuses on acquiring premium office real estate in Mumbai, Bengaluru, Delhi NCR, Pune, Chennai, and Hyderabad. The One Paramount acquisition marks a major addition to its portfolio, complementing earlier purchases of Prius Platinum and a 300,000-square-foot Saket asset in Delhi.

Keppel’s Chennai investments are part of its broader India strategy. The company acquired One Paramount 1 tech park in mid-2024 for Rs. 2,100 crore from a joint venture between RMZ Corporation and Canada Pension Plan Investment Board (CPPIB). This divestment allows Keppel to realise capital gains while continuing to explore new opportunities across India’s growing office market.

Chennai’s office sector has been expanding steadily. Leasing absorption exceeded 10 million sq ft in 2023, and the first half of 2025 alone saw 5.5 million sq ft leased, a 57% increase year-on-year. While Old Mahabalipuram Road remains the IT corridor, new commercial hubs in Radial Road, Tambaram, Ambattur, and Madhavaram are driving demand. Sectoral diversification is also a key factor, with IT, BFSI, global capability centres, and life sciences companies boosting leasing activity. The life sciences segment, in particular, posted 60% growth in 2024, highlighting its potential for long-term office demand.

Institutional investors like Prime Offices Fund seek fully leased, ESG-upgraded assets that offer predictable cash flows. One Paramount fits this model, combining occupancy stability with prime location and premium infrastructure. The acquisition not only strengthens the fund’s Chennai footprint but also reinforces its pan-India strategy, giving investors exposure to multiple commercial hubs.

Experts see the deal as a benchmark for India’s office investment landscape. While cities such as Mumbai and Bengaluru attract global investors, Chennai is increasingly emerging as a compelling alternative. Its combination of cost efficiency, infrastructure improvements, and diversified tenant mix makes it a sought-after destination for large-scale office investments.

The Keppel divestment underscores a broader trend: institutional capital continues to flow into India’s office market, with investors prioritising high-quality, income-generating assets in key urban locations. As Chennai matures as an office hub, transactions like One Paramount are likely to set the tone for pricing, yields, and future investments, reflecting both market confidence and sustainable long-term growth.