Blackstone-backed Nexus Select's mall play: To double count in 3-4 years

Company in talks with IFC for Rs 2,000 crore green funding

This copy has been updated Blackstone-backed Nexus Select Trust, India’s first listed retail investment trust (Reit) plans to double the number of malls it operates and the retail area under its portfolio in the next three to four years by acquiring existing malls across the country.

 

Chief Operating Officer Jayen Naik told Business Standard that Nexus will be looking to fund the expansion through debt and from International Finance Corporation’s (IFC’s) green fund after its malls were certified under the Indian Green Building Council (IGBC) norms.

 

“We are aiming for at least 30 malls in the next three to four years with a gross leasable area of 20 million (square feet). There is enough money to fund this,” Naik said. “Our net asset value is ₹20,000 crore and debt is only ₹4,000 crore. We can go up to 50 per cent debt.”

 

He added that attractive interest rates are available for financing owing to the recent rate cut and more likely to happen in 2025-26.

 

“We are also looking at funding from IFC, which is green funding, because all our 17 malls are IGBC certified and 14 of them are platinum certified, Naik further said. 

 

According to a source, the company is looking to raise around ₹2,000 crore from the IFC.

 

Having acquired the MBD Neopolis mall along with the Radisson Blu Hotel MBD in Ludhiana for ₹490 crore and Vega City mall in Bengaluru for ₹870 crore last month, the company has identified locations and existing malls in 14 cities.

 

These include places where it currently operates from. Potential options include Bengaluru, Delhi, and Gurugram. Naik said the company is also talking to Larsen & Toubro to acquire some of its malls in Hyderabad.

 

With its malls home to more than 1,000 retail brands, including the Apple store in New Delhi’s Select Citywalk mall, Nexus is in discussions with the iPhone-maker to take tenancy positions in some of its malls. Apple has announced plans to add four more locations to its portfolio of exclusive stores in India. “We are in active discussions with them,” Naik noted.

 

The senior executive said he is banking on the continued momentum of India’s consumption story to drive growth in retail space and in turn the company’s own growth despite concerns of a slowdown.

 

“Last year there were elections, and consumption in apparels was definitely muted but we saw very good traction in beauty. Jewellery also did very well with new players coming in and we are also adding them to our portfolio. We just added Indriya in one of our malls, gold purchase is still buoyant. Electronics is still doing very well,” Naik said. 

Mall operators take share of sales of retailers that take up tenancy in their malls.

 

With middle-income earners getting more cash in hand due to the tax breaks announced in the Union Budget 2025 that will come into effect from April, the company expects retail to benefit as it may lead to more purchases by mall goers.