Raheja-Blackstone firm files draft offer document for Rs 3,500-cr REIT IPO

Mindspace Business Parks Real Estate Investment Trust (REIT), sponsored by K Raheja Corp, has filed a draft offer document for the public issue of its REIT. Blackstone Real Estate Partners is one of the key investors in the REIT.

It is the second REIT in the country coming out with a public issue after another Blackstone joint venture (JV) Embassy Office Parks hit the market with its REIT early this year and raised Rs 4,750 crore.

The REIT has roped in 13 bankers, including Morgan Stanley, CLSA, and Nomura for the issue.

Sources said the issue could raise around Rs 3,500 crore, of which Rs 1,000 crore is a fresh issue of shares. The extent of stake dilution is yet to be decided, sources said.

In 2017, Blackstone acquired 15 per cent stake in K Raheja Corp’s select commercial income-producing office portfolio spread over 30 million square (sq.) feet (ft).

Blackstone’s other JVs with Panchshil Realty and Salarpuria Sattva could also come with REIT in the near future, sources said.

REITs are like mutual funds, which are traded on stock exchanges. They are tax efficient as they distribute 90 per cent of profits as dividends.

Real estate developers may raise more than $25 billion over the next three years by listing their rent-yielding commercial properties through the REIT route, according to real estate consultant Anarock Property Consultants.

“Commercial REITs may raise over $25 billion for Indian real estate over the next three years. This involves the listing of more than 150 million sq. ft of rent-yielding Grade A office properties across top seven cities covering 25-30 per cent of the overall Grade A office space in these cities,” said Shobhit Agarwal, managing director & chief executive officer, Anarock Capital.

Currently, the top seven cities — Delhi-National Capital Region, Mumbai, Kolkata, Chennai, Bengaluru, Hyderabad, and Pune — have close to 550 million sq. ft, which are “REIT-able”, he said.