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CWC to monetise assets across India, sees over Rs 1,500 Cr investment : Amit Kumar Singh, MD, CWC

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NEW DELHI : The Central Warehousing Corporation (CWC), under the administrative control of the Ministry of Consumer Affairs, Food and Public Distribution, is planning to monetise and modernise its warehouses across India under the National Monetisation plan.

The public sector enterprise engaged in the business of warehousing, logistics management and allied activities expects to attract investments worth over Rs 1,500 crore through this ambitious programme.

The plan involves development of these warehousing facilities across 80 key locations in the country through public-private partnership (PPP) under Design Build Finance Operate and Transfer (DBFOT) model for a period of 45 years to the concessionaire.

We are monetising 54 sites across the country in the first stage and will add more than 20 to the pipeline in the next stage. We expect the entire process to bring in investments worth over Rs 1,500 crore that will help boost operational efficiencies, technology, innovation, and complete digitisation,” Amit Kumar Singh, MD, CWC, told.

CWC along with advisor Knight Frank India has invited bids for this nation-wide warehousing monetisation program and the entire process is expected to be completed by December end.

Under this plan, CWC will provide encumbrance free sites spread over 200 acres that would require no change of land use and clear title. These pre-approved warehousing sites are spread over 46 acres in tier I cities, around 72 acres in tier II cities and 81 acres in tier III towns.

The bidders are expected to have their financial year 2022-23 net worth of not less than 50% of the cumulative estimated project cost of all the sites that the entity is bidding for.

In case the bidder is an Alternative Investment Fund (AIF) or a Foreign Investment Fund (FIF), it is expected to have a minimum available capital for investment) at the close 2022-23 of two times the cumulative estimated project cost of all the sites that the bidder is bidding for.

Of the total sites, 21 sites are spread over five acres each, seven sites are spread over three-five acres each, while some sites are less than three acres each.

The bidder itself or through its associate entities in the last five financial years is expected to have completed or is operating or maintaining the works including either one project with more than or equal of 80% of the project cost, or two projects with over 60% of the estimated project cost, or three projects with more than 40% of the project cost.

These projects may include, ports, airports, railways, metro rail, industrial parks, logistic parks, real estate development and core sector projects. Real estate development will not include development of residential apartments. Core sector projects will include coal, crude oil, natural gas, refinery products, fertilizers, steel, cement, and electricity.

The demand for warehousing has shown resilience marked with growth in lease rentals for logistic spaces across top eight markets during the half year ended September. While occupier traction seems to have taken a pause in the current analysis period, rent growth across markets has been relatively healthy during the period since March.

Pune and Chennai at 4% and Ahmedabad with a 3% growth in six months were markets with the most growth, showed a Knight Frank India study. The 23 million sq ft space transacted in the first half ending September across the top eight markets represents a 10% on-year drop in volume. Around 53% of these transactions were for Grade A assets.

Transaction activity was well distributed across markets during this period. Pune, the leading market, accounted for 19% of the total warehousing volume, driven primarily by the automotive industry. Mumbai was the second most prolific market, representing 16% of the total warehousing area transacted during the period, with the third-party logistics (3PL) sector as a significant contributor.

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