The initial public offering (IPO) of the first ever by a Real Estate Investment Trust in India (REIT) is here. The IPO of Embassy Office Parks REIT is set to open on March 18 in the price band Rs 299-300.
Embassy Office Parks, a joint venture between the Bengaluru-based property developer and private equity firm Blackstone, has placed 33 million square feet of office and hospitality assets under its proposed REIT. The assets comprise of seven business parks and four city-centric buildings spread across Mumbai, Bengaluru, Pune, and Noida.
Of the 33 million sq ft, about 24 million sq ft is operational with 95 percent occupancy, yielding a rental income of over Rs 2,000 crore annually. Another 3 million sq ft area is under construction and 6 million sq ft is in the pipeline. The JV has some high profile companies as its client with over 50 percent rent is coming from Fortune 500 companies such as Microsoft, Google, Wells Fargo, and JPMorgan.
“This is a historical event for the real estate sector as it shows the market is maturing and that we too can transact as per international standards. At present, only mature economies have a REIT structure in place,” Anshuman Magazine, Chairman – India and South East Asia, CBRE, Money Control reported.
Here are some of the facts and things to know about Embassy Office Parks REIT:
- Embassy REIT is issuing units aggregating up to Rs 4,750 crore.
- The issue, made through the book-building process, will close on March 20.
- The units are proposed to be listed on the National Stock Exchange and BSE.
- The minimum bid size is 800 units and in multiples of 400 units thereafter.
- Proceeds from the same will be used for i) Partial or full repayment of bank/ financial institution debt, ii) Payment for acquisition of the Embassy One Assets currently held by Embassy One Developers Pvt, and iii) For general purposes.
- Not more than 75 percent of the issue, excluding the strategic investor portion, will be available for allocation on a proportionate basis to institutional investors.
- The book running lead managers to the issue are: Axis Capital, Credit Suisse Securities (India), Deutsche Equities India, Goldman Sachs (India) Securities, HSBC Securities and Capital Markets (India), IIFL Holdings, JM Financial and Nomura Financial Advisory & Securities (India).