Blackstone, the world’s biggest private equity firm and India’s largest owner of office properties, has moved to list on stock exchanges a real estate investment trust (REIT) that it sponsors along with a Bengaluru developer via an initial public offering worth Rs 6,200 crore ($712 million).
Knowledge Realty Trust, the REIT sponsored by Blackstone and Bengaluru-based Sattva Group, has filed draft documents for an IPO to raise money to repay loans of Rs 5,800 crore. The REIT and its special purpose vehicles had total borrowings of Rs 19,948.3 crore as of September 30, 2024.
This will be the fifth listed REIT in India, after Embassy Office Parks REIT, Mindscape REIT, Brookfield India REIT and Nexus Select Trust. Of these, Blackstone had sponsored all but the Brookfield REIT.
The PE firm has, however, fully exited Embassy and Mindspace REITs and partially exited Nexus. Overall, Blackstone has mopped up at least $2.8 billion from these exits, VCCircle reported last year.
Knowledge Realty Trust will be the largest listed office REIT in India with gross asset value of about Rs 59,445 crore, according to its IPO documents.
The REIT has 48 million square feet of leasable area. Of this, about 37 million square feet of 30 Grade-A office parks assets across six cities are on the block for listing. These include One BKC and One Unity Center in Mumbai, Sattva Knowledge Park in Hyderabad, Sattva Knowledge Court and Sattva Softzone in Bengaluru, among others.
About 95% of the REIT’s portfolio is concentrated in Mumbai, Hyderabad and Bengaluru. Other cities where the REIT’s assets are located are Chennai, Gurugram, and Ahmedabad. The IPO document showed that its assets have a committed occupancy of 90% as of December.
The REIT has appointed Kotak Investment Banking, Axis Capital, Morgan Stanley, BofA Securities, ICICI Securities, IIFL Capital, JM Financial, and SBI Caps as book running managers for the planned IPO.
Blackstone has a large portfolio of real estate assets in India, spanning office properties, warehouses, hotels, shopping malls and data centres. Overall, it manages real estate assets worth over $20 billion in India.
Late last year, it moved to acquire a stake in Bengaluru-based developer Bagmane, VCCircle reported in November. In April, it joined a slew of institutional investors to pick up a significant minority stake in Mumbai-based Equinox India Developments Ltd, earlier known as Indiabulls Real Estate Ltd. In addition, the PE firm fully owns Nucleus Office Parks and has a logistics platform in India called Horizon Industrial Parks.
Apart from the four REITs, Blackstone has taken several other Indian portfolio companies public in the recent past to monetise its investments. These include hotel operator Ventive Hospitality Ltd and International Gemmological Institute.