Mindspace Business Parks REIT (Real Estate Investment Trust), jointly owned by K Raheja group and Blackstone, is all set to launch its Rs 4,500 crore initial public offering (IPO) this week. The IPO opens for subscription between Monday to Wednesday with a price band of Rs 274-Rs 275 per unit.
This would be the second REIT to hit the IPO market after Embassy Office Park REIT that launched its Rs 4,750 crore IPO in March 2019.
As per the documents filed with SEBI, Rs 4,500 crore Mindspace IPO consists of a fresh issue of units aggregating up to Rs 1,000 crore and offer for sale (OFS) of units of Rs 3,500 crore.
Bids can be made for minimum 200 units and in multiples of 200 units thereafter. It is Rs 55,000 for 200 units for the Mindspace Business Parks REIT.
Important dates regarding IPO
The IPO will open for subscription on July 27 and the public issue will close on July 29. The finalisation of the basis of allotment will be processed on August 6, while the initiation of refunds will be done on August 7. The credit of shares to Demat account will also take place on August 7. Post the IPO, equity shares of the REIT will be listed on both BSE and NSE on August 12, 2020 (tentative date).
About the firm
Mindspace REIT is a high-quality office portfolio in India that serves as an essential corporate infrastructure for multinational tenants.
Backed by real-estate developer K Raheja and private equity firm Blackstone, Mindspace aims a 10.6% growth in revenue from operations this fiscal while the same is expected to clock at 23% in the financial year 2022.
Cape Trading LLP and Anbee Constructions LLP are the promoters of the company.
Objects of the issue
The company said the net proceeds from its fresh issue will be utilised towards partial or full pre-payment or scheduled repayment of certain debt facilities of the Asset SPVs availed from banks/financial institutions (including any accrued interest and any applicable penalties/ premium), purchase of NCRPS of MBPPL, and general purposes.
Mindspace REIT has to invest a minimum of 80% of the value of its assets in completed and rent and/ or income-generating properties, under the REIT Regulations
The bidding for public issue by anchor investors was open on July 24, Friday where the firm raised Rs 1,518.74 crore by allocating shares to institutional investors as part of the anchor allotment for the offer. Domestic institutional investors that participated in the anchor allotment for the IPO include Axis Mutual Fund, IIFL Special Opportunities Fund, ICICI Prudential MF and insurance companies such as Max Life Insurance, Star Health & Allied Insurance Co, and Aditya Birla Sun Life Insurance.
With both strategic and anchor investments, Mindspace has so far raised Rs 2,643.74 crore, which is 58.74% of the total issue size of Rs 4,500 crore.
As of the quarter ended March, the total market value of its portfolio was Rs 23,675 crore. As of FY20, the company's revenue from operations rose about 10% YoY to Rs 15,501 crore.
Mindspace REIT's clients include the likes of Accenture, Qualcomm, UBS, JP Morgan, Amazon, Barclays, Facebook, and Capgemini.
The company 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 company has leased an additional 7 lakh sq ft to tenants across various properties since April 1. It has about 2,500 operational hotel rooms including the ones from Chalet Hotels. It also owns 6 operational malls (including Inorbit Mall) and 278 retail outlets across India.
REIT was introduced in India a few years ago aimed at attracting investment in the real estate sector by monetising rent-yielding assets.
In a move to encourage more retail participation, SEBI had earlier brought down the minimum investment into REIT from 800 units to 200 units.