Cushman & Wakefield, the world’s largest privately held commercial real estate services firm, has expanded its operations in India by twofold with the acquisition of local real estate consultancy Lemongrass Advisors.
Lemongrass Advisors is focused on Kolkata and eastern India, and with this acquisition C&W has added some 23 people to its India team, according to Sanjay Dutt, the firm’s executive managing director for South Asia. The entire team started working at C&W last month, according to a note on the Lemongrass website. The size of the transaction was undisclosed.
C&W’s expansion comes at a time when private equity real estate firms are showing signs of renewed though cautious confidence in the country. Real estate investors have largely consolidated after capital left the country in waves. Indeed, as PERE’s India Report 2013 published this month shows, Indian fund managers are expressing conviction that real estate investors have to add development and construction value to their projects for the long term in order to make returns.
“Like a lot of Asian markets India is still relatively opaque,” said Sachin Doshi, the senior portfolio manager for Indian investments for the Dutch pension manager APG. “It is a market in which you must be willing to spend a lot of hands-on time to understand specific locations and really cultivate a relationship with your partners.”
The C&W acquisition reflects this attitude, as the firm seeks to strengthen its connections and operations in eastern India. As the third largest city in India by GDP, Kolkata serves as an economic hub in the country’s eastern corridor. The firm’s team in Kolkata and Bangalore is hoping to take advantage of the growth in eastern India, as many companies look to expand their presence in the region.
Abhijit Das, the former founder and managing director of Lemongrass Advisors, will lead the Kolkata operations as the new office director for the east, according to Dutt. Under his leadership, C&W hopes to garner a 25 percent to 30 percent market share in eastern India over the next three years, Dutt added.
“Looking at the quality of talent [in Lemongrass], we really felt that this would be a game-changer for us,” Dutt told PERE. Dutt also considered this year to be a crucial time for C&W, because the demographics are suggesting that the region should experience impressive growth and that more value can be added from the real estate sector, especially as many companies look to expand into eastern India. C&W hopes to provide that value through its hub in Kolkata.
Now that the Lemongrass acquisition is complete, C&W has no specific acquisition pipeline at this point, but Dutt stressed that the firm is always open to more acquisitions should the opportunity present itself.
2013 has been a busy year for C&W on the Asian front. Following two office openings early in the year in Taipei and Manila, and in July the firm acquired the entire platform of Singapore-based Project Solution Group (PSG), giving the firm a stronger presence in Singapore and China. Over the past 18 months C&W has added six new offices and over 900 new staff to its Asia operations.