Mindspace Business Parks REIT IPO subscribed nearly 13 times on last day

The initial public offering (IPO) of Blackstone backed Mindspace Business Parks REIT has been subscribed 12.96 times on the third and last day of bidding. The issue received bids for 87,55,55,200 units against an offer size of 6,77,46,400 units. The reserved portion of institutional investors was subscribed 10.62 times and that of other investors saw a subscription of 15.77 times on Wednesday, data compiled from stock exchanges show.

The public offering witnessed a subscription of 1.01 times on Tuesday, the second day of bidding. The price band for IPO was fixed at Rs 274-275 per share. Mindspace Business Parks REIT, owned by K Raheja group and Blackstone, has already raised Rs 1,518.74 crore from anchor investors ahead of its public issue that hit the capital market on July 27. Mindspace had proposed to raise up to Rs 4,500 crore from the public issue.

"The oversubscription of the Mindspace REIT IPO demonstrates that a) there is a demand for a product like REITs to be a part of investor portfolios and b) commercial real estate continues to have the strong backing of both HNIs and institutions. This is contrary to the popular belief that rental assets will be severely impacted due to new norms such as Work From Home (WFH) which have evolved during the COVID pandemic. The success of this IPO shall also bode well for future investments in the sector which have dried up post the spread of the COVID pandemic,"  said Sharad Mittal, CEO, Motilal Oswal Real Estate Fund.

Mindspace Business Parks REIT will be the second REIT to be listed in India, after Embassy REIT. In 2019, Embassy Office Park REIT had raised nearly Rs 5,000 crore.  The REIT, a popular instrument globally, was introduced in India a few years ago aimed at attracting investment in the real estate sector by monetising rent-yielding assets. It helps unlock the massive value of real estate assets and enable retail participation.

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