Embassy Office Parks, India's first listed real estate investment trust (REIT), has priced and allotted by way of a private placement Rs 3,000 crore of secured, redeemable and non-convertible debentures. They will be listed on the wholesale debt market segment of the Bombay Stock Exchange (BSE).
Embassy REIT Series I NCD 2019 carry a face value of Rs one crore with a yield to maturity of 9.4 per cent and will mature in June 2022 (specifically on the expiry of 37th month from the deemed date of allotment). Rating agency Crisil has assigned a rating of 'provisional Crisil AAA/stable' to it. Embassy REIT intends to use the proceeds from the issue to repay its existing debt and for general corporate purposes.
The transaction is in line with the overall financing plan disclosed in the final offer document related to an initial public offering of units that Embassy REIT filed with the Securities and Exchange Board of India (SEBI) on March 27. On April 23, the board had approved issuing debentures aggregating Rs 3,650 crore in two tranches. On May 3, the Board approved allotment of tranche A debentures aggregating Rs 3,000 crore.
JP Morgan Chase Bank, Kotak Mahindra Bank Limited and Morgan Stanley India served as joint structuring advisors on the private placement to Embassy REIT, it said in a statement on Friday after market closing hours. Embassy Office Parks, a joint venture between Blackstone and realty firm Embassy group, is a leading developer of commercial real estate. REIT is an investment tool that owns and operates rent-yielding real estate assets. It allows individual investors to make an investment in this platform and earn income.
Embassy REIT owns and operates a 33 million square feet portfolio of seven Grade A office parks and four city-centre office buildings in the country's best-performing office markets of Bengaluru, Mumbai, Pune and the National Capital Region (NCR). Embassy REITs' portfolio has 24.8 million square feet completed by area, runs at 95 per cent committed occupancy as of December 31 and hosts many of the world's leading companies as tenants.
The portfolio also comprises strategic amenities, comprising two completed hotels (including the Four Seasons Hotel at Embassy One), two under-construction hotels, and a 100 MW solar park supplying renewable energy to park tenants.
(With inputs from agencies.)