Mindspace Business Parks REIT reports net operating income of Rs 658.4 crore in H1FY2021

India’s second real estate investment trust, Mindspace Business Parks REIT, owner and developer of Grade A office portfolio located in four key office markets of India, has reported a net operating income of Rs 658.4 crore for the half-year ended September 2020.

These are the first results it has declared since the public listing of the REIT in August. The company reported its second quarter and half-yearly performance in an exchange filing on November 11.

The company's gross leasing remained on track at 1.0 million sq ft, with an average rent of Rs 70 per sq ft per month. It achieved a re-leasing spread of 33.1 percent on 0.6 million sq ft of area re-leased, it said.

It collected over 99 percent of gross contracted rentals, the company said.

The company raised Rs 5,000 million via debentures at 6.8 percent per annum. Its weighted average cost of debt reduced from 9.2 percent in March 2020 to 8.1 percent in September 2020. It reported a low net-debt-to-market-value of 13.6 percent, the filing noted.

"We have delivered on net operating income and gross leasing in line with our projections, reflecting the ability of the team to perform in challenging times. Our long-standing relationship with tenants and robust asset management, ensured we collected 99 percent rentals. We have also added new tenants to our portfolio, while helping some of our existing tenants grow their footprint within our Business Parks," said Vinod Rohira, chief executive officer (CEO), Mindspace Business Parks REIT.

"The next few quarters remain challenging from a demand perspective, however we will seek opportunities to further build upon our client relationships, re-energise our Parks, focus on health and safety, and partner our clients for their business and growth needs," he said.

The committed occupancy on enhanced portfolio was reported at 88.9 percent, with 4.0 million sq ft completed in last 12 months including 0.8 million sq ft at Commerzone, Porur in Chennai completed in June 2020. The 'Same Store Committed Occupancy' was 94.7 percent between September 2020 and the previous year, on 19.9 million sq ft of commercial space.

On the operations side, the company resumed construction activity, including 1.7 million sq ft of ongoing, on-campus development projects. The workforce strength is increasing gradually and stands at over 75 percent of pre-COVID levels, the company said.

The impact and temporary disruptions of COVID-19 on businesses worldwide and India has been significant. Mindspace REIT has shown a fair degree of resilience, ensuring the inherent strengths and fundamentals of its business remain intact, it said.

Mindspace Business Parks REIT is owned by K Raheja Corp and Blackstone and is the second REIT to be launched in the country. It made its market debut on August 7, 2020.