Mindspace REIT Highlights Benefits of REIT Investments

Mindspace Business Parks , owner and developer of quality Grade A office portfolio located in four key office markets of India, today hosted a media meet in Chandigarh as part of its pan India awareness drive to popularize Real Estate Investment Trusts (REITs). Mindspace REIT has distributed a cumulative over INR 3,900 crores within 4 years of listing on stock exchanges in 2020 and has seen its retail unitholder base grow to over 60,000 investors.

Today, Mindspace REIT sponsored by K Raheja Corp group has a portfolio of 33.2 million square feet with gross asset value of approximately INR 30,000 crores and approximately INR 20,000 crores of equity market capitalization. In the fiscal year 2024, it generated a net operating income of INR 18,959 million (Rs 1895.9 crores). The portfolio encompassing total leasable area of 33.2 million square feet, comprising of 26.3 million square feet of completed area, 4.4 million square feet of area under construction and 2.5 million square feet of future development, consists of 5 integrated business parks and 5 quality independent office assets. It has a diversified and high-quality tenant base, with over 220 tenants.

Speaking on the occasion Mr. Govardhan Gedela, Head Corporate Finance, Mindspace Business Parks REIT said, “REITs in India are increasingly favored for offering investors access to Grade A commercial real estate in a transparent and highly regulated framework. REITs serve as an alternate investment avenue for diversifying portfolios, as we are required to distribute at least 90% of our net distributable cash flow to unitholders, ensuring regular income. Investors also stand to gain from potential capital appreciation. We are pleased to engage with stakeholders in Chandigarh to raise awareness about REITs and eagerly anticipate welcoming more unitholders from this region."

Some features of REITs:

1.       The tax efficiency of the REIT distributions and their affordability, with an individual able to buy just one share of a REIT for as low as ₹100 - ₹400 per unit. That’s as good as buying real estate with just a few hundreds of rupees as opposed to a few lakhs to a few crores, which is the minimum investment one would need to make, if they were to buy such high-quality commercial real estate directly or through a fractional ownership/ strata structure.

2.       Real Estate Investment Trust (REITs) are a globally accepted, liquid, highly-governed and tax-efficient product to invest in commercial and other real estate, through a publicly traded unit. REITs own, operate and/or manage income or rent generating real estate assets.

3.       REITs are tax efficient vehicles that are required to distribute at least 90% of their cash flows at least semi-annually. REITs typically provide stable distribution yields with an in-built capital appreciation potential.

4.       Over INR 17,000 crores distributed by Indian REITs in the past four years, more than the entire Nifty Realty Index combined

5.       Today, there are 4 REITs that comprise over INR 86,000 crores of equity market capitalization, encompass 115+ million square feet of commercial space, and span the Indian office and retail sectors.