Mindspace Business Parks’ Rs 4,500 Crore REIT Issue To Hit Markets On July 27
It will the second such offering in India.
Mindspace Business Parks REIT, owned by K Raheja group and Blackstone, will hit the capital markets on July 27 with its public issue to raise up to Rs 4,500 crore.
It will be raising Rs 1,125 crore from certain strategic investors, including affiliates of Capital Group, GIC Group, Fidelity Group and Fullerton Group who have already made commitments to participate in the issue.
The company, which is launching India's second Real Estate Investment Trust (REIT), on Friday filed the final offer document with the markets regulator Sebi.
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 (OFS). The issue will close on July 29.
Last year, Embassy Office Park REIT, the country's first REIT issue, raised nearly Rs 5,000 crore.
REIT, a popular instrument globally, was introduced in India a few years ago.
The new offer will help broaden the spectrum and encourage the creation of more such structures, said Shobhit Agarwal the MD and CEO of ANAROCK Capital. “Retail investors will have a much wider bandwidth of Grade A office spaces to diversify their investments into,” he added.
Mindspace Business Parks REIT has brought 295 lakh square feet of office properties located in Mumbai, Pune, Chennai and Hyderabad, out of which around 245 lakh square feet area has been 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 NSE.
Despite a multi-year slowdown in the real estate market, the office segment was performing well till the coronavirus pandemic hit India. The net office space leasing was at record 450-500 lakh square feet and gross leasing at 550-600 lakh square feet last calendar year.
However, the COVID-19 crisis 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 square feet, according to a report by Knight Frank India.