US-based New York Life Insurance Company will further invest Rs 196 crore in a commercial project being developed by Max Estates in Noida. In November 2020, Max Ventures & Industries Ltd’s (MaxVIL) realty arm Max Estates roped in New York Life to develop a 7-lakh sq ft commercial project ‘Max Square’ comprising mainly office space, in Noida with an investment of Rs 400 crore.
A special purpose vehicle (SPV) Max Square Ltd was formed to develop this project. Max Estates has 51 percent and New York Life has a 49 percent stake in the SPV. In a regulatory filing, MaxVIL informed that the SPV August won a bid to acquire two land parcels, auctioned by Axis Bank, in Noida for Rs 220 crore.
Both land parcels, located in Sector 129, Noida with a combined size of about 4 acres, are contiguous to under-construction project Max Square. Max Estates has now onboarded New York Life as an “equity co-investor in a structure that already houses 2.66 acres of land on which Max Square is being developed. The addition of another 4-acre land, in the same SPV, will enable the development of around 6.6 acres of mixed-use campus.
New York Life proposes to invest Rs 196 crore for a 49 percent equity stake. Max Estates will be responsible for the final delivery of the project and will be entitled to a development fee on the same. The total development potential of about 6.6-acre campus, including the under-construction Max Square, is around 20 lakh (2 mn) sq ft.
Sahil Vachani, MD & CEO of MaxVIL said, “This transaction will enable Max Estates to expand its commercial real estate portfolio while achieving its aspiration of becoming a leading real estate player in Delhi-NCR.” New York Life has a long-standing relationship with Max Group and Max Estates, he noted. An increase in the size of this project will not only provide prospective tenants of Max Square an option to expand but also enable access to an integrated mixed-use campus.”
As per the filing, Max Estates executed a share subscription agreement and amended & restated the shareholders’ agreement with New York Life on September 26, 2022, for further investment by Max Estates and New York Life in the equity share capital of Max Square in the same existing ratio of 51:49, respectively. The proposal is to issue 10.2 crore equity shares of Rs 10 each to Max Estates and 9.8 crore equity shares to New York Life. That apart, 10.2 crore Compulsorily Convertible Debentures (CCDs) of Rs 10 each at par will be issued to Max Estates and 9.8 crore CCDs to New York Life.
MaxVIL, a part of business conglomerate Max Group, owns and operates a real estate business through its 100 percent subsidiary, Max Estates. Established in 2016, Max Estates has already developed two office projects — Max Towers in Noida and Max House in Delhi. The company is developing a third commercial project in Delhi-NCR named Max Square in partnership with New York Life. Max Estates has also made a foray into the residential segment with its first project planned to be developed in Noida.
In June, it announced the acquisition of Accord Hotels and Resorts Pvt Ltd, which owns a 10-acre land parcel in Noida, for Rs 306 crore. This acquisition will enable Max Estates to develop a mixed-use residential project, with an estimated saleable area of around one mn sq ft.
Earlier this month, MaxVIL announced it will acquire Acreage Builders at an enterprise value of Rs 322.50 crore as part of its strategy to expand its real estate business in Delhi-NCR. Acreage Builders owns 7.15 acres of land at Golf Course Road in Gurugram. MaxVIL plans to develop a commercial project with a leasable area of 1.6 mn sq ft on this land parcel, marking its entry into the Gurugram real estate market.
