Hindaun City, Rajasthan
38%
Asset CAGR
1.47x
Buying Alpha
15Mos
Vintage
1. The Investment Thesis
"Engineering defensive value in a recessionary climate by constructing a specialized logistics and retail hub, leveraging deep-infrastructure utility to secure a profitable exit amidst the 2009 global liquidity crisis."
In 2008, as the global financial outlook darkened, we recognized that standard retail projects would struggle. Our strategy for Jaianati Market was to pivot from "lifestyle" to "utility." Located strategically near the Hindaun Railway Station, the asset was designed to serve the robust, recession-resistant wholesale trade driven by railway logistics.
To unlock this value, we executed a technically demanding "Builder Acting" strategy, constructing a complex with 3 sublevel basements—an engineering feat previously unattempted in Hindaun City. While the upper three floors provided standard retail space (100 shops), the deep basements solved a critical pain point: secure, high-volume storage for traders moving goods via the railway.
This "Deep-Structure" utility created sticky demand that insulated the asset from the 2008 market crash. While other developments stalled, Jaianati Market remained essential to the local supply chain. This stability allowed us to achieve a 7.5% rental yield and execute a strategic full exit in April 2009, effectively converting a high-risk vintage into a secured liquidity event.
2. Valuation Bridge
| Line Item | Amount (PER SQ FT) | Notes |
|---|---|---|
| Land Acquisition | ₹154 | Basis: 1 Cr Purchase Price. Higher land cost than 2007 due to prime Railway Station location. |
| Technical Construction |
| ₹650 |
| High Cost: Excavating 3 basements & waterproofing drove costs significantly higher than standard builds. |
| Approvals & Liaising | ₹45 | Complexity of basement ap |
| Total Cost Basis | ₹849 | The "Hard" Cost. Higher break-even point due to technical complexity. |
| Buying Alpha | ₹401 | The "Utility Spread." Value added by creating unique warehousing supply that didn't exist. |
| Exit Valuation | ₹1250 | The "Safety" Price. Sold at a cap rate derived from the 7.5% yield (April '09). |
The 2008 vintage taught us that when the market gets soft, the asset must get 'hard.' We knew standard retail wouldn't fly as the economy slowed, so we bet on the Railway Station. The decision to construct 3 sublevel basements was technically grueling—dealing with soil stability and water tables in Hindaun City was a nightmare that no local contractor wanted to touch. We had to execute it ourselves. That decision saved the investment. When the financial crisis hit, the fancy shops struggled, but our basements were full. The local wholesalers needed storage for goods coming off the trains, regardless of the stock market. We exited in April 2009 not because the market was hot, but because we held the only asset in town that solved a logistics problem. We traded glamour for utility, and it paid off.
— BK Agarwal, Chief Advisor & Partner
Execution Timeline
Jan 2008
Land Acquisition
Purchased 4,537 sq yards near Hindaun Railway Station for ₹1 Cr
Jan 2008
The "Deep Dig" (Construction)
The most technically challenging phase. "Builder Acting" teams managed deep excavation for 3 sublevel basements, navigating local soil stability issues and water tables.
Aug 2008
Construction Completed
Concrete pouring and structural work accelerated to ensure the "shell" was ready before the market sentiment turned.
Sep 2008
The Global Shock
External Event: Lehman Brothers collapses; global markets freeze. Project Impact: While standard retail demand evaporated, local demand for storage remained consistent. The decision to build basements validated itself immediately as a recession-proof hedge.
Feb 2009
Stabilization & Yield
Leasing: Aggressive leasing to railway-dependent wholesalers. Metric Achieved: Secured tenants for the basements and ground floor shops, locking in the 7.5% rental yield which served as the valuation anchor.
Apr 2009
The Strategic Exit
Liquidity Event: Full exit executed. Capital and profits were