Everstone Capital Management may raise $350m to invest in warehouses

Private-equity and real-estate fund adviser Everstone Capital Management is mulling over plans to raise around $350 million for a new fund to make investments in warehouses in India.
Everstone Capital Management, which was created by two former Goldman Sachs Group Inc. executives, has already invested 25 percent of the $240 million Indospace Logistics Parks fund.
Everstone Investment Advisors Pvt.’s co-founder Sameer Sain said that the firm might begin raising money for the second fund at the end of next year.
Mr. Sain said that India lacked quality warehousing, and they would invest in developing industrial real estate and warehousing facilities in India to exploit potential opportunities created by the government’s plans to change the existing regional tax structure.

Big warehouses, which will replace the existing practice of smaller stockyards in multiple states, will be in great demand once the government’s proposed Goods & Services Tax (GST) is fully implemented. This is done to avoid duplication of taxes but will not be required once the GST regime takes effect.

Speaking on the topic, Mr Sain said, “With the country moving from regional and state levies to a central goods and services tax, the need for regional warehouses in every state will be greatly reduced and companies will move to large central warehouses and distribution centers.”

The Government has reportedly plans to introduce GST by April 2011. The implementation of GST will encourage companies to sign supply and distribution management contracts with logistics companies.
Everstone Capital Partners II, which was introduced in December, has achieved its first close raising totaling $250 million previous month largely from investors in Europe and the Unite States.
According to market researcher Venture Intelligence, private-equity firms pumped around $2.4 billion in as many as deals in India during the three months to June 2010.
Everstone, which has offices in Mauritius, Singapore, Delhi, Bangalore and Mumbai, may list its real-estate assets in the 3 billion rupee Kshitij fund on Indian exchanges.