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Ranjan Pai buys out ritzy hotel's top floor

Billionaire Ranjan Pai, the 41-year-old promoter of Manipal Education and Medical Group (MEMG), has scripted the most expensive office-space purchase, setting a new benchmark in Bangalore's real estate market. Pai has bought around 24,000 sqft of prime real estate space on the top-most floor - the 15th - of JW Marriott Hotel opposite Cubbon Park.

He paid Rs 32,000 per sqft, pegging the deal at Rs 80 crore. This is a new high for commercial real estate in the country's IT capital. In April 2012, TOI had reported that an 8,000-sqft apartment in Kingfisher Towers - Residences at UB City - located a block away from JW Marriott, sold for around Rs 33,000 per sft. That's the highest residential capital value in the city's history. About 15 club rooms, including an exclusive club facility of the iconic hotel property, will be refurbished by Pai to house the corporate headquarters of MEMG.

 The group consists of Manipal Health Enterprises, which owns and operates the Manipal Hospitals chain, Manipal Global Education Services, stem-cell company Stempeutics Research and Manipal Servicecorp Facility Management. With this trophy office acquisition, Pai is among a few Bangalore-based billionaires whose corner office would have an unobstructed view of the Cubbon Park. VG Siddhartha, owner of Cafe Coffee Day, and liquor tycoon Vijay Mallya also have their offices overlooking the Cubbon Park. With an estimated networth of $1.8 billion, Pai figures among the top 60 billionaires in India. Pai, a savvy dealmaker, recently raised $150 million (Rs 900 crore) from Azim Premji by diluting over 10% stake in his education business.

He is close to raising a similar tranche from private equity giant, TPG Capital, for his hospitals unit. The transaction between Pai and Deepak Raheja-owned JW Marriott property was managed by global consultancy firm JLL India. Confirming the deal, Juggy Marwaha, MD, South India, JLL India, said, "This is a unique transaction where the hotel retains its brand value and has a marquee office-space occupier." Marwaha added that purchase price was almost on a par with prices seen in Mumbai's Bandra-Kurla Complex, where office spaces fetch upwards of Rs 35,000 per sqft. Ranjan Pai offered no comment for this report.

The JW Marriott property, owned by Advantage Raheja Group, was built with an investment of Rs 750 crore, roughly Rs 2 crore per room. Global hospitality major Marriott International owns and operates the JW Marriott brand. Demand for office space in Bangalore has been upbeat. Earlier this month, TOI had reported that e-commerce major Flipkart signed the largest office-space lease deal of 3-million sqft with Embassy Office Parks.