Mindspace Business Parks' Rs 4,500 cr REIT issue to hit markets on July 27

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. 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).

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. It is 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, out of which around 245 lakh sq ft 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 sq ft and gross leasing at 550-600 lakh sq ft 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 per cent to 172 lakh sq ft, according to a report by Knight Frank India.