Property Share REIT Limited will soon launch its Initial Public Offering (IPO). This IPO aims to raise Rs. 352.91 crore through a fresh issue of shares. The IPO will open for bidding on December 2, 2024, and close on December 4, 2024. Property Share REIT units are likely to be listed on the NSE and BSE on December 9, 2024. 

Highest-Ever IPO Share Price of Property Share REIT 

The Property Share REIT IPO, with a price band of Rs. 10 lakh to Rs. 10.5 lakh per share, would be among the highest-priced listed securities. 

For comparison, MRF is trading at Rs. 125,040.90 per share and Elcid Investments is trading at Rs. 214,990, making Property Share REIT the highest-priced if listed. 

Overview of Property Share REIT 

Property Share REIT Limited was established in June 2024 and is India’s first SEBI-registered small and medium real estate investment trust (REIT). The trust focuses on completed, revenue-generating properties, with its first scheme, PropShare Platina, offering premium commercial office spaces in Bangalore. 

The trust operates through six wholly owned Special Purpose Vehicles (SPVs), which enhance its operational efficiency. The investment strategy emphasizes acquiring high-quality commercial properties that promise stable rental yields. 

Key Operating Metrics of Property Share REIT 

The proposed property has a projected FY26 yield of 9.0%, a projected FY27 yield of 8.7%, and a projected FY28 yield of 8.6%. Additionally, the property has a 100% occupancy rate, indicating a highly attractive investment opportunity. 

Property Share REIT Limited’s Prestige Tech Platina building has a total leasable area of 2,46,935 square feet, with each floor having an occupancy rate of 100%. The rental income for the building is Rs. 103.2 per square foot per month. 

The total weighted average security deposit of the company is Rs. 13.8 crore, and the projected NDCF (Net Distributable Cash Flow) is Rs. 30.7 crore. The market value of the asset is estimated at Rs. 353.7 crores, with a WALE (weighted average lease expiry) of 9.0 years and a WALoE (weighted average lock-in expiry) of 4.6 years. 

GMP of Property Share REIT 

As of November 28, 2024, there is no GMP available for Property Share REIT IPO at the moment. We will update the information as soon as it becomes available. 

Promoters of Property Share REIT

The IPO is promoted by PropShare Investment Manager Private Limited. The company brings deep industry expertise and is responsible for managing the operations of the trust. 

The offer includes a fresh issue of units, and no existing unitholders are selling shares in this IPO. This move ensures that all funds raised will directly benefit the trust. 

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Lead Manager of Property Share REIT IPO 

The IPO is managed by ICICI Securities Limited, serving as the book-running lead manager. Their expertise ensures a smooth process from subscription to allotment. 

KFin Technologies Limited acts as the registrar, facilitating efficient handling of applications and share allotments. 

Objectives of Property Share REIT IPO 

The primary objectives for raising funds through the Property Share REIT IPO include: 

● Acquiring Prestige Tech Platina assets through SPVs. 

● Funding statutory charges related to property acquisitions. 

● Supporting corporate purposes that enhance operational capabilities.

● Increasing liquidity for future investments in high-potential real estate projects. 

Strengths of Property Share REIT IPO 

Property Share REIT offers several strengths that position it for growth in the Indian real estate market. As India’s first REIT focused on small and medium commercial properties, it targets a unique and high-revenue potential segment. 

The REIT generates stable income from long-term leases of premium commercial spaces. Managed by an experienced team, it aims to reduce debt and enhance financial flexibility, while strong demand in the SME market supports its market positioning. 

Weakness of Property Share REIT IPO 

Property Share REIT faces challenges that potential investors should consider. The trust competes with larger, well-established REITs, which could limit its market share. Being newly established, it lacks a proven track record, raising concerns about its performance history. 

Additionally, the REIT’s heavy reliance on Bangalore’s commercial real estate market limits geographical diversification, exposing it to regional market fluctuations. Economic downturns and regulatory risks also pose challenges to its stability and growth prospects. 

Written By – Nikhil Naik

Disclaimer

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