MUMBAI: K Raheja Corp and Blackstone Group’s Mindspace Business Parks REIT has raised nearly Rs 1,519 crore from 54anchor investors including sovereign entities, insurance companies and mutual funds.International institutions including Government of Singapore, Nomura Trust & Banking, HSBC Global Investment Funds, Fidelity Funds, Societe Generale and Morgan Stanley Asia (Singapore) are among the key anchor investors that have committed investment in the Rs 4,500-crore issue at Rs 275 per unit.
The Government of Singapore and Monetary Authority of Singapore have together committed to 15.74% of total anchor investments in the issue.
SBI Life Insurance, HDFC Life Insurance, Axis Mutual Fund, Aditya Birla Sun Life Insurance Company and ICICI Prudential funds are among domestic investors in the issue, which is slated to open on Monday with a price band of Rs 274-Rs275 per unit.
Prior to this, the REIT has already received commitment worth Rs 1,125 crore from institutional investors including Singapore government’s sovereign wealth fund GIC, affiliates of Fidelity Group, Capital Group and Fullerton Group.
With both strategic and anchor investments, the proposed REIT issue stands nearly 59% subscribed.
“It is encouraging to see such a strong line up of anchor investors for India’s second REIT even during such uncertain times. Despite being a nascent concept in India, the enthusiasm exhibited by the institutional investors reinforces the faith in REITs as a viable financial instrument and its growth potential in the country,” said Anurag Mathur, CEO, Savills India. “REITs could bring some hope to retail investors, especially when interest rates have been softening and returns from investment avenues are diminishing.”
Both K Raheja Corp and US private equity major are diluting their respective holdings in this issue. This is India’s second REIT and is looking to raise funds through a fresh issue of Rs 1,000 crore and an offer sale worth Rs 3,500 crore.
Mindspace REITs’ portfolio includes a total leasable area of 29.5 million sq ft with five integrated business parks and five independent offices across Mumbai Metropolitan Region (MMR), Pune Hyderabad and Chennai. It comprises 23 million sq ft of completed area, 2.8 million sq ft under construction and 3.6 million sq ft future development space, as on March 31, 2020.
It has leased additional 7 lakh sq ft to tenants across various properties since April 1 including pre-committed 42,567 sq ft area in its under-construction asset in Chennai. Rents achieved from these new leases are higher than the market rents estimated for the vicinity. As per the revised filing with SEBI, it has completed additional 3.3 million sq ft new offices since its previous filing last year.
However, the company has collected 97.8% and 95.2% of its gross contracted rentals for the months of April and May 2020 during lockdown, respectively. The company has reported net profit of Rs 513.9 crore for the year ended March on the back of total income of Rs 2,026.2 crore.
Source: ET Markets