SEBI consents to Knowledge Realty Trust’s Rs.4,800 crore REIT-IPO
It is expected to launch in the first week of August
The Securities and Exchange Board of India (SEBI) has approved Knowledge Realty Trust’s (KRT’s) Real Estate Investment Trust (REIT) Initial Public Offering (IPO).
The company had filed the draft red herring prospectus (DRHP) with SEBI to launch an IPO and list the REIT on stock exchanges in March. This is part of a strategy to monetise its 30 prime office assets across major cities.
Backed by the Sattva Group and Blackstone, KRT, which aims to raise Rs.4,800 crore, has already raised Rs.1,400 crore from investors, and will become India’s largest REIT by gross asset value (Rs.62,000 crore).
The company hopes to soon begin its roadshow, and the price band will be announced on 30 August 30. In the previous fiscal year, its net operating income was Rs.3,432 crore.
Owning over 46 million sq ft of office space across 29 locations in six cities, including Mumbai, Bengaluru, and Hyderabad, the assets include One BKC and One World Center in Mumbai, Knowledge City and Knowledge Park in Hyderabad and Cessna Business Park and Sattva Softzone in Bengaluru.
Meanwhile, Sattva and Blackstone will continue to own about 80 percent of the REIT.
India has four listed REITs: Brookfield India Real Estate Trust, Embassy Office Parks, Mindspace Business Parks, and Nexus Select Trust, with a combined portfolio of over 126 million sq ft of Grade A office and retail space across the country. Since their inception, they have collectively distributed over Rs.21,000 crore to unitholders.
Barring Nexus Select, which owns a large portfolio of retail real estate spaces, the other three are backed by rent-yielding office assets.
Bengaluru-based Sattva Developers has so far constructed 74 million sq ft across seven Indian cities in commercial, residential, co-living, co-working, hospitality, and data centre sectors. Additionally, 75 million sq ft is in planning and implementation stages.
On the other hand, Blackstone is one of the leading global investment firms, having a huge exposure in the Indian real estate market.
The two sponsors will adopt a brand-neutral strategy to grow the KRT portfolio inorganically through third-party acquisitions.