Mindspace Business Parks REIT Fixes Price Band At Rs 274-275 For Public Issue

Mindspace Business Parks REIT, owned by K Raheja group and Blackstone, has fixed the price band for its Rs 4,500 crore public issue at Rs 274-275 per unit.

Mindspace, which is launching India's second Real Estate Investment Trust, had filed the final offer document with the market regulator SEBI last week.

It will hit the capital market on July 27 with its public issue to raise up to Rs 4,500 crore. The issue will close on July 29.

Bids can be made for a minimum of 200 units and in multiples of 200 units thereafter other than anchor and strategic investors.

As per the offer document, Mindspace Business Parks REIT aims to raise up to Rs 1,000 crore through issue of fresh units and up to Rs 3,500 crore through offer for sale.

Out of the total proposed size of the public issue, the company will be raising Rs 1,125 crore from certain strategic investors who have already made commitments.

Last year, Embassy Office Park REIT, the country's first REIT issue, had raised nearly Rs 5,000 crore.

The REIT, a popular instrument globally, was introduced in India a few years ago aimed at attracting investment in the real estate sector by monetising rent-yielding assets.

It helps unlock the massive value of real estate assets and enable retail participation.

Mindspace Business Parks REIT has brought 295 lakh sq ft of office properties located in Mumbai, Pune, Chennai and Hyderabad under the REIT portfolio and out of that around 245 lakh sq ft areas are completed.

The annual rental income is currently around Rs 1,300 crore, which is estimated to reach Rs 2,000 crore in next few years, sources said.

The company had filed the initial offer document in December last year.

The units of the REIT will be listed on the BSE and the NSE.

Despite multi year slowdown in the real estate market, the office market was performing well till coronavirus pandemic hit India. The net office space leasing was at record 450-500 lakh sq ft and gross leasing at 550-600 lakh sq ft last calendar year.

However, the Covid-19 has forced the corporates and co-working players to defer their expansion plans.

As a result, the gross leasing of office space during the January-June period fell 37% to 172 lakh sq ft, according to a report by Knight Frank India.