Citigroup is investing around $250 million in Bangalore-headquartered real estate major Nitesh Estates. However, the exact quantum of stake could not be ascertained.
The deal, the single-largest in ’s hospitality sector, will see Citi partner Nitesh in the latter’s hospitality foray, which involves setting up at least five luxury hotels, said sources close to the deal.
Citigroup Property Investors will invest directly from its global fund into holding entity Nitesh Estates as well as special purpose vehicles (SPVs) for setting up properties, which may also include shopping malls. Citi’s Asia-Pacific real estate fund head David Schaefer led the investment into the 31-year-old Nitesh Shetty-managed realty group.
However, Nitesh Estates executive director LS Vaidyanathan declined to comment on the deal. Citigroup is picking up a minority stake in the holding company. Citi will, however, hold substantial slakes in individual SPVs setting up the chain of hotels, sources added.
The latest deal with Citigroup does not include ’s first Ritz-Carlton property, which Nitesh is developing in Bangalore. It is believed that Nitesh may be Ritz-Carlton’s preferred partner, not exclusive though, in .
Along with Citi, Nitesh plans to develop five-star hotels in
Subsequently, Citi invested $35 million into an SPV for the Ritz-Carlton project in
Nitesh Group, as part of a backward integration move, is also getting into construction as well as infrastructure with separate entities being set up for the same.
Courtesy: The Economic Times