Nexus Select Trust will launch on May 9 to raise up to Rs 3,200 crore 2023

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Nexus Select Trust will launch an initial public offering (IPO) on the capital market on May 9 to raise up to Rs 3,200 crore for its retail REIT.

This is India’s first REIT (Real Estate Investment Trust) IPO supported by retail real estate assets that generate rental income. Currently, there are three REITs listed on stock exchanges, but they are all supported by office assets.

Nexus Selct Trust, sponsored by the global investment firm Blackstone, has lodged its IPO offer document with the market regulator SEBI.

According to the offer document, the total size of the public offering is Rs 3,200 crore, comprised of a fresh issue of units worth up to Rs 1,400 crore and an offer for sale (OFS) of up to Rs 1,500 crore.

The company intended to raise as much as Rs 4,000 crore through its proposed REIT public offering.

Nexus Select Trust filed the draft red herring prospectus (DRHP) with Sebi in November 2017 in order to initiate its retail REIT public offering.

The portfolio of Nexus Select Trust comprises 17 operational shopping malls in 14 significant cities, totaling 9.8 million square feet.

This will be the third REIT that Blackstone has sponsored.

Embassy Office Parks was India’s first REIT, followed by Mindspace Business Parks REIT.

REIT, a globally renowned instrument, was introduced in India a few years ago to attract investment in the real estate sector by monetising assets that generate rental income. It helps unlock the immense value of real estate assets and allows retail investors to participate.

Currently, there are three REITs listed on Indian stock exchanges, Embassy Office Parks REIT, Mindspace Business Parks REIT, and Brookfield India Real Estate Trust, but they all hold leased office assets.

Nexus Select Trust has added the Select Citywalk Mall in south Delhi to its portfolio of 9.8 million square feet of retail real estate.

There are approximately 3,000 stores in 17 shopping centers, and there are nearly 1,100 brands.

Regarding the proposed retail REIT, Gagan Randev, Executive Director of India Sotheby’s International Realty, remarked that the retail sector in India has demonstrated remarkable resilience and consistent development since the COVID pandemic.

Individual and institutional investors can benefit from the retail sector’s stability and long-term potential by investing in retail REITs, he said.

Moreover, according to Randev, investors will be able to distribute their risk across a diversified real estate portfolio.

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