Brookfield India Real Estate Trust REIT

🏢 Brookfield India REIT's Strategic Acquisition & Strong Q1 Performance

- Board approved acquisition of 50% effective stake in Parthos Properties Private Limited (Target SPV), which owns three floors in Godrej BKC, Mumbai, for an enterprise value of ₹ 17,000 million (on 100% basis).

- The acquisition price is at a discount of 3.59% to the average of two independent valuations of Rs. 17,633 million (on 100% basis).

- Brookfield India REIT will subscribe to up to 6,250,000 unlisted NCDs of Target SPV (face value Rs. 100 each) for a cash consideration of up to Rs. 625 million.

- Acquisition of up to 100% stake in a holding company (Target Holdco) and infusion of funds via equity shares (up to Rs. 749.99 million) and/or compulsorily convertible debentures (up to Rs. 2,525 million) to effectively hold 50% of Target Holdco.

- The remaining 50% share capital in Target Holdco is to be acquired by NCW's Prime Offices Fund; if NCW does not acquire, Brookfield India REIT has the right to acquire 100%.

- The transaction is a related party transaction as the sellers (Project Diamond Holdings (DIFC) Limited and Project Cotton Holdings One (DIFC) Limited) are part of the Brookfield group.

- An extraordinary meeting of unitholders is scheduled for September 3, 2026, to seek approval for the acquisition, although unitholder approval is not mandatory under REIT Regulations.

- Target SPV's turnover for FY 2023-24 was INR 749.99 mn, FY 2024-25 was INR 672.01 mn, and FY 2025-26 was INR 772.77 mn.

- The GBKC Asset comprises 264,000 SF with 100% committed occupancy, in-place rent of Rs 369 PSF, and a WALE of 6.9 years.

- Brookfield India REIT reported Q1 FY2027 results: Net Operating Income of Rs 7.6 Billion, Distributions of Rs 4.6 Billion, and DPU of Rs 5.60.

- Leasing performance for Q1 FY2027 included gross leasing of 1.1 MSF, re-leasing spread of 14%, and committed occupancy of 93%.

- The REIT's portfolio has an operating area of 32.6 MSF, committed occupancy of 93%, in-place rent of Rs 104 PSF, and a WALE of 6.7 years.

- LTV stands at 25.9% excluding shareholder instruments, with a dry powder of Rs 43 Billion for future growth.

- Brookfield India REIT reported Q1 FY2027 financial results with Operating Lease Rentals of ₹7,140 million and Net Operating Income (NOI) of ₹7,566 million.

- Gross leasing for Q1 FY2027 was 1.1 million square feet with an average re-leasing spread of 14%.

- Committed occupancy stood at 93%, up 4% year-on-year.

- Declared a distribution of ₹5.60 per unit for the quarter.

- Announced a proposed acquisition of a 264,000 square feet Grade A front-office property in BKC, Mumbai, in a 50:50 partnership with NCW Prime Offices Fund, for an enterprise value of ₹17,000 million.

- The acquisition is expected to be funded through cash reserves at the trust level of ₹3,810 million, with ₹8,808 million of existing property debt to be continued or refinanced.

- The pro-forma portfolio Net Debt post-acquisition is estimated at ₹153,627 million, with a pro-forma LTV of 27.4%.

- The target property has a committed occupancy of 100% (including LOIs), a WALE of 6.9 years, and an in-place rent of ₹369 PSF per month.

- The acquisition implies a discount to Gross Asset Value (GAV) of ~4% and an NDCF yield of 7.1%.

- Raised ₹26 billion of equity through a Qualified Institutional Placement in April 2026.

- Same-store NOI grew 8% year-on-year.

- Achieved early renewals of 0.6 million square feet for lease expiries beyond FY2027, including renewal of approximately 80% of Airtel Center.

- Portfolio Gross Debt stood at ₹145.1 billion with a cost of debt of 7.3% as of June 30, 2026.

- Several assets achieved ESG certifications, including IGBC Platinum Rating for Worldmark, New Delhi, and EDGE Advanced Certification for Candor TechSpace N1 and N2.

- Valuation report prepared by iVAS Partners (IBBI/RV/02/2020/112) for Brookfield India Real Estate Trust's proposed acquisition of three office floors (2nd, 3rd & 4th) in 'Godrej BKC', Mumbai.

- Subject Property details: Total Carpet Area 151,195 sft, Total Leasable Area 263,984 sft, Leased Area 215,794 sft, Vacant Area 48,190 sft. Weighted average efficiency is ~57%.

- Valuation date is 30 June 2026. Market Value assessed using Income Approach with Discounted Cash Flow (DCF) methodology.

- Key financial assumptions include a one-time capital expenditure (Capex) of INR 30.68 Mn for common lobby and partition walls on the second floor.

- Maintenance Capex considered at INR 2 per sft per month on Total Leasable Area.

- Valuer relies on information provided by the Client, including Rent Roll, Title Search Reports by Khaitan & Co., and various statutory approvals (Occupancy Certificate, Fire NOC, Environmental Clearance, etc.).

- Important limitations: Valuer's maximum liability limited to professional fee received; report is not financial advice; values are estimates, not guarantees; assumes information provided is accurate.

- Valuer discloses no conflict of interest, independence from Brookfield India Real Estate Trust, and compliance with SEBI REIT Regulations and International Valuation Standards (IVS).

- Report highlights heightened market volatility due to Middle East conflict, advising caution as it may impact global and Indian property markets.

- Valuation is for acquisition purpose as per SEBI (Real Estate Investment Trusts) Regulations, 2014, and may be included in transaction documents and regulatory filings.

- Valuation of three office floors (2nd, 3rd, 4th) in 'Godrej BKC', Bandra Kurla Complex, Mumbai, owned by Parthos Properties Private Limited (PPPL).

- Brookfield India Real Estate Trust (BIRET) proposes to acquire not less than 50% and up to 100% stake in the Subject Property from existing Brookfield Group shareholders (a related party transaction).

- Property Market Value assessed at INR 17,706.0 Mn as of 30 June 2026 using Discounted Cash Flow method.

- Total leasable area is approx. 263,984 sft with a carpet area of approx. 151,195 sft (weighted average efficiency ~57%).

- Current occupancy is ~82% (215,794 sft leased, 48,190 sft vacant on Floor 2).

- Key financial assumptions: In-place rent of INR 363 per sft per month, 1-year Forward NOI of INR 987.09 Mn, Exit Cap rate of 7.50%, Discount rate of 11.46%.

- Market rent adopted for valuation is INR 412 per sft per month (inclusive of car park charges).

- Property is a Non-IT, LEED Platinum certified Grade A office space, operational since 2016, with a remaining leasehold tenure of approx. 60 years.

- Tenant mix includes State Bank of India, International Finance Corporation, PayPal Payments, Brookfield Advisors India, Workday India, Netflix, Nayara Energy, Abbott.

- Valuation highlights heightened market volatility risk due to Middle East conflict, potentially impacting global energy, financial markets, and supply chains.

- Valuation date: 30 June 2026.

- Subject property: Three office floors (2nd, 3rd & 4th) in 'Godrej BKC', Bandra Kurla Complex, Mumbai. Total leasable area: 263,984 sft.

- Market rent adopted for valuation: INR 412 per sft per month (as of valuation date).

- Key tenants include State Bank of India, Brookfield Advisors, Workday India, Credavenue, International Finance Corporation, and PayPal.

- Parking income detailed: e.g., State Bank of India (25 cars at INR 5,000/month), Brookfield Advisors (7 cars at INR 12,763/month), Workday India (11 cars at INR 15,000/month).

- Fit-out income from Workday India: INR 99 per sft per month until 31 Jan 2028.

- Rent escalation assumptions: Typical clause ~5% p.a. after 12 months; some at ~7% p.a. after 12 months and ~15% after 36 months. Market rental growth expected at 5% YoY.

- Property tax for FY26: INR 34.6 Mn*. Escalated at 5% p.a.

- CAM assumptions for FY26: Expense at INR 23.6 per sft per month; Income at INR 34.7 per sft per month. Escalation at 5% p.a. from FY27.

- Other key assumptions: Vacancy provision 2.5%, Rent-free period 3 months, Downtime 3 months, Transaction cost on exit 0.5% of terminal value.

- Capex assumptions: 2nd floor common lobby/partition walls capex of INR 30.68 Mn (Jul-Sep 2026). Maintenance capex: INR 2 per sft pm.

- Exit Capitalization Rate (Cap Rate) range: 7.0% to 8.0%, with an average of 7.5% adopted.

- Discount Rate (WACC) calculated at 11.46%, based on cost of debt 8.10% and cost of equity 14.50%, with a debt:equity ratio of 47.5%:52.5%.

- Valuation result: Total Market Value estimated at INR 17,706.0 Mn. This comprises Property value of INR 17,679.6 Mn and Value of Fit-outs at INR 26.4 Mn.

- Projected Net Operating Income (NOI) shows growth, e.g., FY2028: INR 1,166.2 Mn, FY2033: INR 1,620.1 Mn, with variations year-on-year.

- Valsight Advisors Private Limited issues a valuation report for Godrej BKC (3 Operational Floors) in Bandra Kurla Complex, Mumbai, as of 30 June 2026.

- The valuation is prepared for Brookfield India REIT for the purpose of disclosing asset valuation as per SEBI REIT Regulations.

- The Subject Property comprises the 2nd, 3rd, and 4th floors of Godrej BKC, with a total leasable area of 2,63,984 sq. ft.

- The property is 100% owned by Parthos Properties Private Limited (PPPL), currently wholly owned by the Brookfield Group.

- Brookfield India REIT proposes to acquire not less than 50% and up to 100% stake in PPPL, making this a related party transaction.

- The assessed Market Value of Godrej BKC (3 Operational Floors) is INR 17,560 Million (Indian Rupees Seventeen Billion and Five Hundred and Sixty Million Only).

- The property has a committed occupancy of 81.7% as of the valuation date, with key tenants including State Bank of India, Credavenue Private Limited, and International Finance Corporation.

- The valuation methodology used is the Discounted Cash Flow (DCF) Method using rental reversion.

- The property is located on a total land area of ~2.55 Acres (~1,10,972 Sq.ft) at Plot No. C-68, G-Block, Bandra Kurla Complex.

- Based on provided Title Search Reports, there are no material litigations, revenue pendencies, or encumbrances reported on Parthos Properties Private Limited or the asset.

- The property has received necessary statutory approvals including MPCB Consent, AAI Height NOC, Fire NOC, and Environmental Clearance.

- The building is LEED India Core & Shell Pre-certified Platinum (November 2013).

- The valuation report includes specific disclosures as required by SEBI Schedule V, covering valuation basis, assumptions, property details, and valuer declarations.

- Valuer agrees to be identified as an 'expert' in Offer Documents with unlimited liability under applicable law.

- Valuer must be joined as a necessary party/respondent in any claims related to the valuation report and cannot object.

- Client agrees to reimburse Valuer's costs (legal fees, external counsel) for being joined as a party/respondent.

- Valuer cannot disclose report contents except as permitted under SEBI REIT Regulations.

- Both parties must comply with Anti-Corruption Laws, including the Prevention of Corruption Act, 1988.

- Valuation relies on market report by Cushman and Wakefield India Private Limited (C&WI).

- Mumbai office market total completed stock till Q1 CY 2026 is 119.2 msf with 8.9% vacancy.

- BKC & Annexe micro-market has total completed stock of 10.9 msf, current vacancy of 3.8%, and market rent of INR 361 psf/month.

- Competitive REIT Micro-Market - BKC has total completed stock of 9.9 msf and current vacancy of 4.0%.

- Subject Property is Godrej BKC (3 Operational Floors) with leasable area of 2,63,984 sq. ft. and committed occupancy of 81.75%.

- Subject Property is 100% owned by Parthos Properties Private Limited (PPPL), a Brookfield Group entity.

- Brookfield India REIT proposes to acquire not less than 50% and up to 100% stake in the Subject Property (a related party transaction).

- Current in-place rent (excluding car parks) is INR 363 per sq. ft. per month.

- Top 5 tenants account for ~89% of leased area and ~89% of gross rental income.

- Weighted Average Lease Expiry (WALE) is ~7.0 years, with ~47% of occupied area expiring between 2026 and 2031.

- Valuation uses DCF method with a 10-year cash flow period and assumptions including achievable market rent of INR 420 psf/month and rental growth rate of 5.0% p.a. from 01 April 2027.

- There is a capex of Rs. 30.68 million for Common Lobby and Partition walls to be incurred between Jul 2026 to September 2026.