### **Overview** Mindspace Business Parks REIT, sponsored by the K Raheja Corp group, is one of India’s largest and most prominent Real Estate Investment Trusts (REITs) focused on Grade-A commercial office spaces. Listed on Indian stock exchanges in August 2020, the REIT owns and manages a diversified portfolio of high-quality business parks and standalone office assets across four key markets: **Mumbai Region, Pune, Hyderabad, and Chennai**. As of **November 2025**, the REIT’s total leasable area stands at **38.2 million square feet (msf)**, comprising: - **31.0 msf of completed space** - **3.7 msf under construction** - **3.5 msf designated for future development** The portfolio includes **five integrated business parks** and **six standalone office assets**, serving over **270 tenants**, including Fortune 500 companies, multinational corporations (MNCs), Global Capability Centers (GCCs), and leading domestic enterprises. --- ### **Portfolio Highlights & Geographic Diversification** - **Completed Assets:** Approximately **91.2% of the portfolio value** is derived from completed assets, reflecting a **de-risked development profile** and stable income generation. - **Market Concentration:** - **Mumbai and Pune** together account for **49.7% of total portfolio value**, with Mumbai alone contributing significantly through assets like Mindspace Airoli. - **Hyderabad accounts for 42.0% of total asset value (INR 153,808 million)**, making it the second-largest regional contributor. - **Flagship Asset:** The highest-value asset is **Mindspace Madhapur 2 (Hyderabad)**, contributing **37.2% of total portfolio value (INR 152,401 million)**. --- ### **Market Presence & Micro-Market Strategy** Mindspace operates strategically across distinct commercial micro-markets, positioning itself in high-demand, infrastructure-rich zones: #### **Hyderabad** - **Madhapur (Core IT Hub):** - Accounts for **60–70% of city’s office leasing activity**. - Home to **Mindspace Madhapur**, a 48.43-acre integrated IT SEZ with **10 buildings** and **5.14 million sq ft** of leasable area. - Building efficiency ratio of **72–75%**, in line with Grade-A standards. - **Rental escalation projection: ≥5% annually**, supported by low vacancy and strong demand. - Major tenants include **IBM, Qualcomm, Wipro, AMD, Accenture, HSBC, and LTIMindtree**. - **Financial District / Raidurg:** - Includes **Commerzone Raidurg**, a **Grade-A IT SEZ** built on 9.07 acres with 2.8 million sq ft of leasable area. - Acquired in January 2025 via Right of First Offer (ROFO) for INR 2,038 crores at a **7.5% valuation discount**. - Fully leased to **Qualcomm**, a Fortune 500 company, with a **12-year WALE** and embedded **mark-to-market (MTM) upside** (under-rented at ₹69 vs market rate > ₹85/sq ft). - **Pocharam (Outskirts):** - Houses two **completed, vacant buildings** (Buildings 8 & 9), offering **0.57 million sq ft** of leasable space. - **19 acres reserved for future development**, but **no immediate plans** to develop; the REIT has approved **divestment** of this underperforming asset due to weak demand. - **Gachibowli / Porur Hybrid Demand:** - Leasable areas between **0.8–2.03 million sq ft** with strategic access to metro and highways. - Projects benefit from strong **social and physical infrastructure** and are in high-demand zones. - Estimated achievable rent: **INR 95/sq ft/month**, with **3-month rent-free assumed for new leases**. #### **Mumbai Region** - **Airoli (Navi Mumbai):** - **Mindspace Airoli East** is the largest business park in the region, developed on **50.1 acres**. - Total leasable area: **7.2 msf**, with **4.9 msf completed**. - Key tenants: **Accenture, LTIMindtree, Cognizant, and L&T TS**. - **Mindspace Airoli West**: - Strategic focus on **data center development**; partnering with **Princeton Digital Group (PDG)** to build **India’s largest data center campus** (1.05 msf across three facilities). - This supplements two existing data centers (0.63 msf), expanding REIT’s digital infrastructure footprint. - **Bandra-Kurla Complex (BKC):** - **The Square BKC**: 150,000 sq ft Grade-A non-SEZ office tower. - Fully leased, commanding **premium rent of ₹240/sq ft/month**—among the highest in India. - Located in India’s most prestigious office micro-market, with **6.4% CAGR in rentals (2022–2025)**. - Assumed **5% annual rent escalation** long-term. #### **Pune** - **South Business District (SBD East):** - **Gera Commerzone Kharadi**, spanning **26 acres**, is a key asset with **2.9 msf leasable area**. - 100% occupied; tenants include **Barclays, BP, Amazon, and Allstate**. - New Building R5 (1 msf) fully pre-leased to a GCC, with **Occupancy Certificate secured**. - **Suburbs East (Fursungi):** - Growing hub with tenants like **Amazon, IBM, and WNS**, but challenged by infrastructure gaps. - Future growth expected post-metro (2026+). #### **Chennai** - **Porur (Secondary Business District):** - **Commerzone Porur** spans **6.13 acres**, with **1.15 msf** in two Grade-A blocks. - Fully owned via **Horizonview Properties** (100% subsidiary). - Key tenants: **HDFC, Hitachi, Simpliwork, R1 RCM, NPCI**. --- ### **Business Model & Operations** - **Brands:** Operates under three distinct brands—**Mindspace, Commerzone, and The Square**—offering unified, high-quality office experiences. - **Tenant Base:** - Over **270 tenants**, including **68% foreign MNCs** and **31–32% Fortune 500 companies**. - **Top 10 tenants contribute 34.8% of gross contracted rentals**, with **no single tenant exceeding 5.3%**—indicating low concentration risk. - **Facility Management:** - In-house platform **CAMPLUS** enhances tenant experience through integrated services, sustainability, and operational efficiency. - **Subsidiaries & SPVs:** - Operates through a network of **special purpose vehicles (SPVs)** like **Sustain Properties, Avocado, Horizonview, Gigaplex, Sundew, and Intime Properties**. - **Sustain Properties Private Ltd. became a 100% subsidiary in April 2025**, holding Commerzone Raidurg. --- ### **Strategic Growth Pillars** 1. **Organic Expansion:** - Redevelopment of aging buildings (e.g., **Madhapur Blocks 1A/B, 7/8**) to add ~**2.94 million sq ft** of modern space. - Construction underway on **4 buildings in Madhapur (3.7 msf)** with completions scheduled **Q4 FY26 to Q4 FY28**. 2. **Right of First Offer (ROFO):** - 10-year ROFO on **~15 msf** of sponsor pipeline assets across Hyderabad, Mumbai, and Chennai. - Example: **Commerzone Raidurg (1.8 msf)** acquisition in 2025 was ROFO-driven and **accretive to DPU by 0.8%**. 3. **External Acquisitions & Consolidations:** - Acquired full ownership of Commerzone Porur (2023–2024) and Commerzone Yerwada units (2024). - Focused on **increasing control, leasing velocity, and operational efficiency**. --- ### **Development Pipeline & Capex Outlook** - **Total Development Pipeline (Estimated Capex): INR 41,856 million** - **Mindspace Airoli East & West (Mumbai): INR 21,606 million** - **Madhapur (Hyderabad): INR 14,000+ million** - **Under Construction (Nov 2025):** - **Madhapur:** Buildings 1, 8, Experience Centre (~1.73 msf) - **Airoli West:** Data centers, new office blocks - **Yerwada, Juinagar, Pallikaranai:** Ongoing developments --- ### **Financial & Operational Performance Indicators** - **Committed Occupancy (June 2025): 93.0%** (excluding Pocharam) - **Weighted Average Lease Expiry (WALE): 7.6 years** - **Mark-to-Market (MTM) Upside:** **10.4%**, with some assets (e.g., Yerwada) showing **>20% rental upside**. - **Re-leasing Spreads:** - **22.8% (FY25)** on 3.6 msf re-leased - **25.9% (9M FY25)** on 2.0 msf - **Average New Lease Rent:** **₹81/sq ft/month** (ex-data centers) - **In-Place Rent:** Increased to **₹71/sq ft/month** (June 2025), up from ₹65.2 in FY23. --- ### **Sustainability & ESG Leadership** - **Green Certifications:** - **99.9% of existing portfolio** and **100% of new developments** are **IGBC/LEED Gold or Platinum certified**. - **GRESB Recognition:** - Named **Global Listed Sector Leader (2023 & 2024)** in GRESB Development Benchmark. - Ranked **#1 in Asia – Listed Companies (Commercial Business)** with a **sustainability score of 91/100 (Standing Investments)** and **99/100 (Development Portfolio)**. - **ESG Financing:** - Issued **India’s first REIT-level green bond (INR 5,500 crore)** to fund sustainability initiatives. - Joined **TCFD**, implemented green leasing, and source **77% construction materials locally** to reduce emissions.