### **Overview** Nexus Select Trust (NXST) is **India’s first and largest publicly listed retail Real Estate Investment Trust (REIT)**, focused exclusively on owning and operating Grade-A urban consumption centers. Established in August 2022 and sponsored by Wynford Investments Limited (an affiliate of Blackstone), the company operates a premium portfolio of **19 high-quality retail destinations across 15 tier-1 and tier-2 Indian cities**, with a total gross leasable area (GLA) of **10.6 million square feet**. NXST has evolved from a mall operator into a modern **urban consumption platform**, integrating retail with office, hospitality, and solar assets to create mixed-use, experiential hubs. The company serves over **133 million visitors annually**, hosts **more than 3,200 stores** featuring **over 1,000 domestic and international brands**, and maintains a **97% retail occupancy rate**, underscoring strong tenant and consumer confidence. --- ### **Investment Thesis and Strategic Vision** #### **1. Growth Strategy: "Nexus 2.0" and Vision 2030** NXST is executing a strategic five-year evolution called **“Nexus 2.0”**, aimed at **doubling its portfolio by 2030**—expanding from 19 to **30–35 malls** and increasing GLA from 10.6 million to **18–20 million square feet**. The vision is anchored in: - **Portfolio Expansion**: Targeting inorganic growth through a **$1 billion acquisition fund**, focusing on single-owner, high-potential Grade-A retail assets with strong fundamentals and scalability. - **NOI Growth**: Aiming to **double retail Net Operating Income (NOI)** from ~INR 16 billion (FY25) to over **INR 30 billion by 2030**, driven by organic and inorganic growth. - **CAGR Target**: Projecting **over 15% compound annual growth rate (CAGR)** in NOI over the next five years. #### **2. Plug-and-Play Acquisition Model** NXST follows a **disciplined, value-accretive acquisition strategy**, acquiring underperforming or undervalued assets and rapidly repositioning them through: - **Operational Turnaround**: Proven track record in revitalizing assets (e.g., **Fiza by Nexus, Nexus MBD Neopolis, Nexus Vega City**) to boost occupancy and tenant sales. - **Plug-and-Play Integration**: A six-step model involving acquisition, capital expenditure, premiumization, marketing, cost optimization, and yield enhancement for faster value realization. - **Funding Model**: Maintaining conservative leverage (current LTV at **18%**) and aiming for **28–30% LTV** to support growth. Acquisitions are funded via debt, sustainability-linked bonds, and cash, ensuring **no equity dilution**. --- ### **Portfolio Highlights** | Metric | Value | |-------|-------| | **Malls** | 19 Grade-A urban consumption centers | | **Cities** | 15 key Indian cities including Mumbai, Delhi, Bengaluru, Hyderabad, Pune, and Ahmedabad | | **Gross Leasable Area (Retail)** | 10.6 million sq ft | | **Total Portfolio GLA (Retail + Office + Hospitality)** | ~12 million sq ft | | **Occupancy (Retail)** | 97% | | **Annual Footfall** | 133+ million | | **Brands** | 1,000+ domestic and international brands | | **Stores** | 3,200+ | | **Office GLA** | 1.3 million sq ft (88% occupied) | | **Hospitality** | 450 keys (68% aggregate occupancy) | | **Solar Power** | 15 MW capacity | #### **Key Assets (Notable Properties)** - **Nexus Elante (Chandigarh)**: India’s largest retail center in the North, 1.3M sq ft GLA, 98% occupancy, ₹8,473M tenant sales (H1 FY25–26). - **Nexus Seawoods (Navi Mumbai)**: India’s largest **transit-oriented development**, direct access to Seawoods railway station, 30-km catchment radius, 97–99% occupancy. - **Nexus Whitefield (Bengaluru)**: Located in a major IT hub, 98% occupancy, includes EV charging zone and 143-key Oakwood Residence. - **Nexus Hyderabad**: First Grade-A mall in the city, 99% occupancy, hosts 184+ brands. - **Nexus Select Citywalk (Delhi)**: Among India’s highest-performing malls by tenant sales per sq ft; hosted **Apple’s first company-owned store in Delhi**. - **Mangaluru, Amritsar, and Udaipur Properties**: Strategic Tier-II city expansions focusing on local consumer aspirations and tourism-linked demand. --- ### **Business Model & Revenue Drivers** #### **1. Dual-Engine Revenue Model** - **Base Rental Income**: Supported by **contractual rent escalation (5% annually or 15% every 3 years)**. - **Turnover Rent**: **88% of leases** include revenue-sharing of **5%–25%** above a sales threshold, linking income directly to tenant performance. - **Ancillary Revenue Streams**: Event space rentals, digital advertising (via NexusONE), parking, convenience services, food court branding, and ticketed experiences. - **Pioneered food court naming rights** monetization—the first in India. - Ticketed events (e.g., *Pokemon Fiesta, Dinoverse*) generated **INR 60 million in FY25**. #### **2. Lease Management & Re-leasing Advantage** - Over **95% leases** have **minimum guaranteed rents**. - **50% of gross rental income** is up for renewal in the next 3.5 years (Q3 FY26–FY29), with **estimated 20% mark-to-market upside** over expiring rates. - Weighted Average Lease Expiry (WALE): ~5–6 years, providing **long-term income visibility**. - Re-leasing spreads consistently **positive (20–21%)**, reflecting strong tenant demand. --- ### **Tenant and Category Strategy** NXST is repositioning its portfolio to align with evolving consumer behavior, especially Gen Z and millennial preferences. Key focus areas: - **High-Growth Categories**: Deepening presence in **Jewellery, Beauty, Food & Beverage (F&B), and Experiential Retail**. - Launched **seven new jewellery stores** and created **jewellery zones** (e.g., at Nexus Seawoods). - Enhanced F&B offerings, doubling F&B rental income in key properties. - **Brand Mix Premiumization**: Introducing **aspirational and D2C brands** (e.g., Snitch, Zouk, Lenskart, Sephora, Nykaa) and exclusive brand outlets (EBOs). - **Anchor Tenants**: Partnerships with global brands such as **Zara, H&M, Apple, Sephora, Decathlon, and Cinepolis** ensure consistent footfall. - **Key Account Management**: Supports national and international brands in their pan-India expansion, enabling faster rollouts and co-developed store formats. --- ### **Technology and Digital Transformation** #### **NexusONE App – Driving Engagement & Revenue** - **500,000+ users**, responsible for **10% of tenant sales** across the portfolio. - Features: Personalized rewards, AR navigation, bill uploads (₹10B+ lifetime bills), loyalty programs, and event bookings. - **40% repeat transaction rate**, indicating high retention and engagement. - Generates data-driven insights and supports **hyperlocal marketing**. #### **Experiential & Immersive Retail** - **Anamorphic digital displays** (e.g., Prismox, Ayaam) and **AI-generated marketing visuals** enhance visual storytelling. - Hosts **large-scale ticketed experiences** (e.g., Army Boot Camp, Neon Park) to boost footfall and dwell time. - **Digital advertising platform** monetizes over 130K sq ft of display space. --- ### **Sustainability and ESG Leadership** - **15 MW Solar Power Plant** operational in Solapur, significantly reducing carbon footprint. - **GRESB 5-Star Rating** – ranked **#2 among listed retail REITs in Asia** (June 2025). - Emissions reduced by **over 12,500 tons of CO₂ annually** through renewable energy. - Sustainability-linked bonds issued at **7.2% interest**, with proceeds tied to ESG performance (e.g., carbon reduction, energy efficiency). --- ### **Financial and Operational Performance (H1 FY25–26)** - **13% YoY growth in Net Operating Income (NOI) and tenant consumption**. - **Leased occupancy at 97%, trading occupancy at 95%**. - **Nexus 2.0 initiatives yielded double-digit footfall and sales growth** at recently acquired malls: - **Nexus Vega City (Bengaluru)**: Achieved **20% YoY growth in tenant sales** post-integration. - **Nexus MBD Neopolis (Ludhiana)**: Positive turnaround with strong consumption growth. - **Refinanced debt at 7.54%** (Q4 FY25), reducing overall cost of debt to **7.9%**. - **Distribution growth target of 10% for FY26**, aligned with NOI growth of **15%**.