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Nexus Select Trust REIT, India's first real estate investment trust (REIT) with retail properties and sponsored by global private equity leader Blackstone Group is scheduled to launch its initial public offering to raise over 4,000 crores in the first week of May. After the two earlier trusts that contained office buildings, this will be Blackstone's third REIT in the nation. India's first REIT, Embassy REIT which was backed by an institutional investor debuted on the public market in 2019 while Mindspace REIT went public in 2021.
The Nexus REIT's DRHP (draft red-herring prospectus) was submitted in mid-November and efforts are currently being made to submit the offer document by mid-April in the coming days. The portfolio's projected total asset value is above $3 billion. Nexus Select Trust has a portfolio totalling 10 million square feet of retail space with 17 active shopping centres spread over 14 major Indian cities. These properties are located in a number of cities such as Delhi, Bangalore, Navi Mumbai, Chandigarh, Chennai and Hyderabad which together account for 30% of the nation's discretionary retail spending and have had rapid population expansion.
According to the DRHP, the retail portfolio's more than 3,000 outlets have an overall occupancy rate of 95% and get more than 130 million shoppers each year. The Select Citywalk Mall in south Delhi would be a part of this retail REIT portfolio as first reported by ET. The recent purchase of commercial assets from Prestige Group including malls in Bangalore, Chennai and Hyderabad by international institutional investors will also be included in the planned REIT portfolio.
A Real Estate Investment Trust (REIT) is a company that owns, operates, or finances income-producing real estate. These properties can range from apartment complexes, office buildings, shopping centres, warehouses, and other commercial real estate assets. By investing in REITs, individuals can gain exposure to the real estate market without purchasing the property. REITs are required by law to distribute at least 90% of their taxable income to shareholders as dividends, which makes them a popular investment for income-seeking investors. They are also known for their potential for capital appreciation, as the value of the underlying real estate assets may increase over time.
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