Embassy Office Parks REIT eyes workplace property worth up to $2 billion

Embassy Office Parks REIT can accumulate new office belongings worth $1.Five billion without diluting more equity, consistent with chief government officer Mike Holland.

Shares of Embassy Office Parks, India’s first REIT (real estate investment trust), debuted on Monday and closed at ₹314.10 apiece on the BSE, up 4.7% from its difficulty charge of ₹300. It is sponsored by global personal fairness company Blackstone Group LP and Bengaluru-primarily based developer Embassy Property Developments Pvt. Ltd.

The Embassy Office Parks REIT IPO turned into subscribed 2. Fifty-eight instances during its initial proportion sale between 18 and 20 March. The IPO noticed the REIT enhanced a total of ₹4,750 crores.

“You can break our future boom into internal or natural growth and external or inorganic growth. Our inner increase is complete of 7.9 million sq. Toes of on-campus improvement. That takes us from the modern-day operational potential of 25 million sq. Ft to 33 million sq. Ft,” stated Holland.

The REIT may also observe outside acquisitions. “These should be available paperwork, both as part of our (proper of the first offer) agreement with our sponsor Embassy. They offer, and we decide whether or not we need to collect that asset. There is a total of 40 million sq. Toes that Embassy is obliged to provide to us” said Holland.

He said the REIT would also exit and examine the 1/3 birthday celeb of the ration properties. “We will look at that to ensure it suits our common theme, which is hug: huge-scales, enterprise parks, and belongings that dominate its micro-market. There is a different capital gains tax gain that an indexed REIT has in India, which allows us to be more competitive on such acquisitions than others,” said Holland.

Given the REIT’s low debt level, 12% of the market value of belongings, there is enormous headroom to elevate debt by as much as 49%, as allowed by employing the rules to grow the portfolio stated. “Given the headroom, we can gather an office area of around $1.5-2 billion while not having to elevate more equity,” said Holland.

The REIT’s portfolio has an occupancy rate of 95% with more than a hundred and sixty blue-chip tenants. Office houses that might be part of the REIT include the Express Towers at Nariman Point in South Mumbai and the First International Finance Centre inside the Bandra-Kurla Complex.

The REIT’s IPO was subscribed to largely by foreign institutional investors, including Fidelity International, Capital Group, TT International, and Schroders. On the home front, traders, including Kotak Mahindra Life Insurance Co. Ltd and the family office of Radhakishan Damani, the promoter of Avenue Supermarts Ltd, which runs the D-Mart supermarket chain, participated in the imparting.