New Delhi, June 24 (PTI) Global fund Blackstone on Wednesday raised around USD 300 million (about Rs 2,270 crore) by selling its shares in Embassy Office Parks REIT to monetise part of its investment, sources said.
Blackstone was targeting to raise up to USD 257 million (around Rs 1,950 crore), but increased the size of its offer on account of increased demand from institutional investors.
Embassy Office Parks REIT, the country’s first Real Estate Investment Trust (REIT), was launched last year by realty firm Embassy group and Blackstone to raise nearly Rs 5,000 crore. The REIT is listed on the stock exchanges.
Blackstone raised USD 300 million (Rs 2,270 crore) by selling shares/units in the REIT to institutional investors through block deals at Rs 341 per share, sources said.
According to a regulatory filing, Blackstone group sold and transferred 6,71,13,600 units (aggregating 8.70 per cent of the total outstanding units of the Embassy Office Parks REIT) through a bulk trade on exchanges.
Post this deal, Blackstone’s stake will come down to around 46.61 per cent from 55.3 per cent shareholding earlier.
Sources said the demand was to the tune of USD 500 million (nearly Rs 3,800 crore) from both current REIT holders and new institutional investors.
According to bulk deal data updated with the BSE later in the evening, Blackstone sold over 3.3 crore shares of Embassy Office Parks REIT.
The shares were offloaded through its entities — India Alternate Property Ltd, BRE/Mauritius Investment and SG Indian Holdings (NQ) Co I Pte Ltd.
Shares were sold at an average price of Rs 341, valuing the transaction at Rs 1,125 crore.
The stocks were picked up by American Balanced Fund, Signature High Income Fund and Nomura India, data showed.
Earlier sources said that Capital Group, CI Funds, ICICI Prudential have increased their holding in the REIT.
New global institutional investors such as Brookfield, Nomura Asset Management, Norges Bank and Pru Sec bought shares, they added.
Blackstone, which has deployed over USD 8 billion in the Indian commercial real estate space, will continue to hold the majority stake in Embassy REIT. Embassy group has around 15 per cent stake.
“This transaction helps diversify institutional ownership and improve liquidity. We remain the largest shareholder of Embassy REIT and are quite optimistic about its future, Blackstone President and COO Jonathan Gray said in a statement.
“We continue to be big believers in India and its potential. We have significant confidence in the office sector and Embassy REIT given growing demand from domestic and global companies for Indian talent, particularly in technology hubs like Bangalore,” he added.
Embassy REIT spokesperson said the reported transaction significantly increases Embassy REIT’s public float, enhances liquidity and diversifies investor base.
“The participation from global investors demonstrates the continuing appeal of the REIT product to existing and new investors as well as the strength and resilience of our business. Blackstone continues to be the single largest investor underlining their commitment to the Embassy REIT,” the spokesperson said.
Meanwhile, Embassy Office Parks REIT distributed Rs 531.67 crore for its unitholders for the quarter ended March and nearly Rs 1,900 crore for the entire last fiscal.
The revenue from operations for the fourth quarter of FY20 grew year-on-year by 8 per cent to Rs 543.4 crore. For the full last fiscal, it rose 14 per cent to Rs 2,144.9 crore.
Net operating income for the fourth quarter grew by 10 per cent to Rs 461.8 crore. For the full 2019-20 fiscal, it grew by 15 per cent to Rs 1,817 crore.
Since Embassy REIT listed in April 2019, the company has delivered a total return of 25 per cent.
Embassy REIT comprises 26.2 million square feet of completed and operational commercial properties across India.
With approximately 7.1 million square feet of on-campus development in the pipeline, the total portfolio spans 33.3 million square feet across seven Grade A office parks and four city-centre office buildings in India’s best performing office markets of Bengaluru, Mumbai, Pune and the National Capital Region (NCR).