Mindspace REIT's profit jumps 11% to Rs 401 crore, good time to invest?
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Mindspace REIT's profit jumps 11% to Rs 401 crore, good time to invest?

By Vishul Sapra

Last updated - Nov 29th, 2022

Table of content

Quick takes:

  • Mindspace's real estate portfolio's committed occupancy stood at 85.6 per cent in Q1 FY23.
  • The company has a total leasable area of 31.8 million square feet.
  • Mindspace Business Parks REIT is backed by sponsors like Anbee Constructions LLP and Cape Trading LLP.

Mindspace Business Parks REIT saw its net operating income rise by 11 per cent year-on-year to Rs 401.4 for the quarter ending June 2022. In comparison, the company registered a profit of Rs 361.8 crore in the same period last year.

Backed by the impressive financial performance for the quarter under review, the real estate investment trust company declared a dividend of Rs 261.5 crore or Rs 4.41 per unit to unitholders for the first quarter of the financial year 2022-23. The company will also pay Rs 19 crore or Rs 0.32 per unit to unitholders in interest.

"After recording one of the best years of leasing in the financial year 2022, the tailwinds continue to grow stronger", said Vinod Rohira, chief executive officer (CEO) of Mindspace REIT.

"Our strategy of upgrading our offerings during downtime and implementing the best asset management practices has allowed us to benefit from the anticipated demand upswing," CEO Rohira added.

In Q1 FY23, the committed occupancy of the real estate portfolio of Mindspace stood at 85.6 per cent. On the other hand, the firm leased 0.9 million square feet during the last financial quarter.

"The demand recovery initially led by the large occupiers is now seeing broad momentum. We expect a stronger recovery in the second half of the year as a greater percentage of employees return to their offices," Rohira was quoted as saying in Economic Times.

Mindspace Business Parks REIT Performance

Mindspace Business Parks made its debut on public markets in August 2020. Since then, the company has been performing well, despite a downturn in the public markets. So far, Mindspace Business Parks REIT Performance has provided 11.33% returns to investors year to date and more than 20% since its listing two years ago. Mindspace's market capitalization stood at Rs 21,697 crore as of 24 August 2022.

Mindspace Business Parks Portfolio

Mindspace Business Parks REIT has office portfolios based in Mumbai, Pune, Hyderabad, and Chennai, with a total leasable area of 31.8 million square feet. Overall, the company's portfolio includes five integrated business parks, along with the same number of independent office assets.

Mumbai Region - Mindspace counts Mindspace Airoli East and Mindspace Airoli West, Paradigm Mindspace Malad, and The Square and Avenue 61 (BKC) in its portfolio in the Mumbai region.

Hyderabad Region - Business Parks in Mindspace's portfolio include Hyderabad's Mindspace Madhapur and Mindspace Pocharam REIT.

Pune Region - Commerzone Yerwada, The Square Signature Business Chambers (Nagar Road), and Gera Commerzone Kharadi are all part of the company's portfolio in Pune.

Chennai Region - Mindspace's portfolio includes Commerzone Porur in Chennai.

Reasons to invest in Mindspace Business Parks REIT

  • Quality Assets: The majority of Mindspace's portfolio's buildings are either Gold or Platinum Certified Green Buildings (IGBC/LEED). The assets offer a community-based environment and have been built to suit the expectations of "new generation firms" and tenants' growing standards, making it one of the top choices for local and international corporations.

  • Impressive Tenant Base: As of 30 June 2022, Mindspace's portfolio comprised more than 178 tenants, with no single tenant contributing more than 5.9% of the company's Gross Contracted Rentals. Multinational and Indian corporate entities comprise most of the REIT's tenant base.

  • Sponsors Backing It: Mindspace Business Parks REIT is backed by sponsors like Anbee Constructions LLP and Cape Trading LLP. Both the sponsors are part of the K Raheja group, a real estate developer having interests in malls, hotels, and commercial and residential developments across several Indian cities.

Author avatar
Vishul SapraInvestment Associate

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