Mindspace Business Parks REIT

- Mindspace Business Parks REIT expects NOI (Net Operating Income) to grow by over Rs. 900 crores in the next 3-4 years driven by: - Leasing of 2.1 million sq.ft. vacant area, especially in Airoli. - Completion of 4.4 million sq.ft. under-construction projects. - Planned development of 3.9 million sq.ft. - Mark-to-market rental escalations. - The REIT aims to maintain strong occupancy, targeting about 93.5% by the end of FY25. - Distribution income grew 7.5% year-on-year, with Q2 FY25 distributions crossing Rs. 3 billion. - Improved rental rates (in-place rent increased from Rs. 67 to Rs. 70.4 per sq.ft. over 12 months) support earnings growth. - Strong lease spreads, diverse tenant mix, and low vacancy expected to sustain profitability. - Continued focus on capital-efficient development and acquisitions will support EPS growth.

- The overall portfolio stands at 34.7 million square feet. - The upcoming development pipeline includes 2.1 million square feet of vacant area, 4.4 million square feet under construction, and 3.9 million square feet planned for future development. - Data centers form a significant part, with 1.05 million square feet under new built-to-suit agreements. - The company expects NOI growth over the next 3-4 years driven by leasing of vacant, under-construction, and planned spaces totaling approximately 10.4 million square feet. - Gross leasing in the current year has been strong with 2.1 million square feet leased in Q2 and an expected 2 million square feet in the second half of the year. - The company actively pursues acquisitions to consolidate ownership, e.g., 260,000 square feet acquisition at Mindspace Madhapur.

- The REIT has a strong balance sheet with a low loan-to-value (LTV) ratio of 21.9%. - Recent acquisitions, such as the purchase of 260,000 sq ft at Mindspace Madhapur, are being funded through debt. - The overall cost of debt remains healthy at around 7.9%. - Financing mix is optimized between SPV and REIT levels to achieve the best cost of funding. - The REIT has financial flexibility to pursue growth opportunities, including acquisitions and development. - No explicit mention of fresh equity fundraising in the current quarter. - Future acquisitions, whether from sponsors or third parties, are expected and will drive growth. - The CFO mentioned redemption of MLD (Market Linked Debentures) worth Rs. 80 crores in Q1, lowering finance costs, implying active management of debt. - Overall, fundraising appears focused on debt optimization and strategic acquisitions rather than new equity issuance at this time.

- Overall CAPEX for FY25 is around Rs. 1,100 crores, with Rs. 170 crores allocated for property upgrades. - Upgrades include landscaping, amenities, club facilities, and improvements in buildings like Madhapur’s Building 4, spending approx. Rs. 1,000 per square foot for upgrades. - Ongoing development projects include new office buildings and data centers: Building R2 in Kharadi, Pune and B8 Data Center in Gigaplex, Airoli (scheduled completion in Q4 FY25). - Approved acquisition of approx. 260,000 sq.ft. area in Mindspace Madhapur from a third party to consolidate ownership. - Demarcated 2.1 million sq.ft. SEZ spaces at Airoli for better leasing. - Focus on low double-digit development yields (around 12%) for both under-construction and future developments. - Development and leasing pipeline expected to generate Rs. 900 crores NOI over next 3-4 years. - Continued focus on tenant experience, ESG, and sustainability in capital investments.

- Mindspace Business Parks REIT expects Net Operating Income (NOI) to grow by over Rs. 900 crores over the next 3 to 4 years driven by: - Leasing of 2.1 million sq. ft. vacant area, particularly in Airoli. - Completion of 4.4 million sq. ft. of under-construction projects. - Planned development of 3.9 million sq. ft. - Rental and contractual escalations. - Revenue from operations for Q2 FY’25 grew 6% year-on-year to Rs. 6.2 billion. - NOI for Q2 FY’25 increased 5.1% YoY to Rs. 5 billion, crossing Rs. 5 billion for the first time. - Distribution grew 7.5% YoY to Rs. 3.05 billion. - Strong leasing performance with 2.1 million sq. ft leased in the quarter; targeted occupancy of 93.5% by end FY25. - Portfolio expansion and acquisitions (e.g., 260,000 sq. ft acquisition at Mindspace Madhapur) expected to contribute to future growth. - Market demand remains robust with strong leasing momentum, especially from global and domestic firms.