Embassy Office Parks REIT has received regulatory approval for an initial public offering in what would make it India's first real estate investment trust to list on stock exchanges.
The Mint newspaper reported, citing an Embassy spokesperson, that the Securities and Exchange Board of India has approved the IPO proposal.
The IPO involves a fresh issue of units worth up to Rs 5,250 crore ($750 million). It will also include an offer for sale, according to the draft prospectus. It didn't disclose the value of this portion.
The REIT is sponsored by private equity firm Blackstone Group LP and Jitu Virwani-led Bengaluru developer Embassy Group.
Embassy did not immediately offer a comment. Blackstone didn't respond to a request for comment till the time of filing this article.
SEBI had first notified the REIT regulations in 2014. However, few developers showed interest in setting up REITs as investors wanted more measures, including tax breaks. SEBI subsequently modified the regulations several times in a bid to attract investors.
The Embassy REIT is seen as path-breaking as it could set the stage for other developers to tap the public markets for capital.
The Blackstone-Embassy joint venture was formed in 2012 with an aim to develop office projects. Blackstone and Embassy had filed an application with SEBI to form the REIT in 2016.
The REIT was set up in March 2017. It operates in Bengaluru, Pune, Mumbai and Noida.
Blackstone Real Estate has so far put in $3.9 billion in office assets across 100 million sq ft while its REIT portfolio with Embassy has a leasable area of 33 million sq ft.
Morgan Stanley India, Kotak Mahindra Capital, JP Morgan India, DSP Merrill Lynch are the global coordinators and book running lead managers for the IPO.
Axis Capital, Credit Suisse Securities, Deutsche Equities India, Goldman Sachs (India), HSBC Securities And Capital Market, IIFL Holdings, JM Financial And Nomura Financial Advisory And Securities (India) are book running lead managers for the IPO.
