UPDATE 1-Singapore's CapitaLand invests in 15 India malls

SINGAPORE Jan 22 (Reuters) - CapitaLand Ltd. (CATL.SI) said on Tuesday it was pushing into India's fast-growing retail sector by investing in 15 malls worth S$2.1 billion ($1.45 billion), with the aim of spinning them off into a REIT.

Singapore's CapitaLand, Southeast Asia's largest property firm, will enter into a 50-50 joint venture with Bangalore-based builder Prestige Group for seven malls in South India, and will take an undisclosed majority stake in eight North India malls in another venture with Delhi-based developer Advance India Projects.

"The two partnerships provide CapitaLand with a head-start in the retail real estate business in both North and South India," Chief Executive Officer Liew Mun Leong told reporters at a media briefing.

"We expect to deepen our retail and fund management presence in India to become a significant long-term retail real estate player there over time." CapitaLand said the total investment in the malls -- with a total leaseable area of over 11 million sq feet (1 million sq metres) -- will be over S$1 billion, to be funded fully by its 45 percent-owned CapitaRetail India Development Fund, which closed on Nov 22 last year after raising US$600 million.

CapitaLand said it plans to exit the investments by injecting the properties into a new real estate investment trust (REIT), but has yet to decide when or where the properties will be spun off, citing the ongoing turmoil in global financial markets.

"In the current volatile market, that is very hard to consider," Liew said.

CapitaLand said it has further exposure to the India retail market -- which it views as attractive because of its young and increasingly affluent population -- through its investment of $75 million in the Horizon Realty Fund in 2006.

The fund, which is sponsored by Indian retailer Pantaloon Retail (PART.BO), currently owns another six malls across India, CapitaLand said.

(Reporting by Daryl Loo; editing by Jennifer Tan)