Mindspace Business Parks Reit · NSE:MINDSPACE.RR
Mindspace Business Parks Reit — Q3 FY25 Earnings Presentation
67 slides from Mindspace Business Parks Reit's earnings presentation, Jan 24, 2025
Slide 1: Cover letter to stock exchanges
January 24, 2025 To, The Listing Department The Listing Department The National Stock Exchange of India Limited BSE Limited Exchange Plaza, Plot No. C/1, G - Block, Phiroze Jeejeebhoy Towers, Bandra Kurla Complex, Dalal Street, Bandra (E), Mumbai - 400051 Mumbai - 400001 Scrip Symbol: “MINDSPACE” (U
Slide 2: Cover letter signature page
The above information shall also be made available on Mindspace REIT’s website at https://www.mindspacereit.com/investor-relations/stock-exchange-filings. Please take the same on your record. Thanking you. Yours faithfully, For K Raheja Corp Investment Managers Private Limited (Formerly known as K R
Slide 3: Press Release: Results for Q3 FY25
Annexure-1 Mindspace Business Parks REIT Announces Results for Q3 FY25 Announces Highest Ever Distribution of INR 3,155 Mn; Growth of 10.9% YoY Robust gross leasing of c.1.7 msf in Q3 FY251 NOI Grows by 8.3% YoY to INR 5.2 Bn Mumbai, January 24, 2025: Mindspace Business Parks REIT (BSE: 543217 | NSE
Slide 4: Financial Highlights and Distribution
Financial Highlights • Clocked Net Operating Income (NOI) growth of c.8.3%1 YoY in Q3 FY25 to INR 5,218 Mn. o c.7.5%1 YoY growth in 9MFY25 to INR c.15 Bn. • Low Loan-to-Value (LTV) of approximately 22.6%21demonstrating good balance sheet strength. • Average cost of borrowing at the end of quarter st
Slide 5: About Mindspace REIT
with superior infrastructure and amenities. It has a diversified and high-quality tenant base, with over 225 tenants as of Dec 31, 2024. Most of the buildings in the portfolio are either Gold or Platinum Green Building Certified (IGBC/LEED). The assets provide a community-based ecosystem and have be
Slide 6: Q3 FY25 Investor Presentation
Annexure-2 Q3 FY25 Investor Presentation 24th January 2025 mindspacereit.com 1
Slide 7: Disclaimer
Disclaimer By attending the meeting where this presentation (“Presentation”) is made, or by reading the Presentation materials, you agree to be bound by the following limitations: This Presentation (a) is for information purposes only without regards to specific objectives, financial situations or n
Slide 8: Table of Contents
Table of Contents Key Highlights : Q3FY25 04 Project Updates 09 Financial Updates 12 Our Markets 17 Our Franchise & Portfolio 25 Re-energizing Parks 36 Value Creation via ESG 45 Shareholding Pattern 49 Annexures 51 Note: 1. For ease and simplicity of representation, certain figures may have been rou
Slide 9: Key Highlights
01 Key Highlights mindspacereit.com 4
Slide 10: Q3 FY25: Strong Operational Performance driving Financial Growth
Q3 FY25: Strong Operational Performance driving Financial Growth 1.7 msf (1) Robust Gross Leasing incl. pre-leasing 4.9 msf 9M Gross Leasing ; highest leasing in a year (2) c. 1.0 msf Pre-leased c. 1msf in Kharadi, Pune to renowned GCC 8.3% Y-o-Y NOI growth Y-o-Y (3) c. INR 3.2 Y-o- Bn Distribution
Slide 11: Stable Leasing Activity Sustains High Occupancy Rates
Stable Leasing Activity Sustains High Occupancy Rates Key Operating Indicators Q3 FY25 9M FY25 Gross Leasing 1.7 msf (1) 4.9 msf (2) Re-leased Area 0.2 msf 1.4 msf New and Vacant Area Leased 0.5 msf 1.4 msf Re-leasing Spread(3) 26.4 % 25.9 % on 0.5 msf on 2.5 msf Average Rent for Area Leased INR 76
Slide 12: Modern and Sustainable workplaces attracting occupiers
Modern and Sustainable workplaces attracting occupiers High Quality Portfolio with 6 out of 9 parks(1) achieving > c.96% committed occupancy levels 100% 100% 100% 98.6% 96.7% 100% Gera The Square The Square Mindspace Mindspace Commerzone Commerzone Nagar Road BKC Malad Madhapur Porur Kharadi Pune Q3
Slide 13: 9M FY25 – 60% of expiries re-leased at a healthy spread of 26%
9M FY25 – 60%(1) of expiries re-leased at a healthy spread of 26% 0.3 msf scheduled for expiry during Q4 FY25 ~70% re-leasing visibility for 2.7 msf expiries in FY25 Overview of Lease Expiry and Re-leasing spread FY25 E Average Re-leasing Spread(2) 22.3% 2.7 msf (Since listing) 0.8 msf 1.9 msf Retai
Slide 14: Project Updates
02 Project Updates mindspacereit.com 9
Slide 15: Gearing for Demand Resurgence (1/2)
Gearing for Demand Resurgence (1/2) Pune Mumbai Region Commerzone Kharadi Mindspace Airoli East Building 4 Highstreet Leasable area: ~1.0 msf Leasable area: ~0.07 msf Status: Entrance Lobby & Lift lobby Finishes, Status: Building completed and MEP Low-side works in progress Completion date
Slide 16: Gearing for Demand Resurgence (2/2)
Gearing for Demand Resurgence (2/2) Hyderabad Hyderabad Hyderabad Mindspace Madhapur Mindspace Madhapur Mindspace Madhapur (1A-1B Re-development) (Experience Center) (7/8 Re-development) Leasable area: 1.3 msf Leasable area: 0.13 msf Leasable area: 1.6 msf Status: 5th Floor slab casting & B2
Slide 17: Financial Updates
03 Financial Updates mindspacereit.com 12
Slide 18: Financial Performance Supported by Rising Organic Cash Flows
Financial Performance Supported by Rising Organic Cash Flows Key Financial Indicators Q3 FY25 (Y-o-Y) 9M FY25 (Y-o-Y) Figures in INR Mn Revenue from Operations(1)(2) 6,419 7.6% 18,847 8.0% Net Operating Income(1)(2) 5,218 8.3% 15,218 7.5% Distribution 3,155 10.9% 9,198 7.8% DPU 5.3 p.u 10.9% 15.5 p.
Slide 19: NDCF Build-up
NDCF Build-up Particulars (INR Mn) Q3 FY25 Revenue from Operations(1) 6,419 Property Taxes & Insurance (205) Other Direct Operating Expenses (995) Net Operating Income (NOI) 5,218 Property Management Fees (152) Net Other Expenses (111) EBITDA(1) 4,955 Cash Taxes (Net of Refunds) (799) Working Capita
Slide 20: Stable Distribution with Potential Organic Growth
Stable Distribution with Potential Organic Growth Distribution Overview Q3 FY25 9M FY25 Repayment of Distribution SPV Debt, ₹1.88, 35% INR 9,198 Mn Dividend, ₹3.20, 60% DPU ₹5.32 p.u. Interest, ₹0.22, 4% INR 15.5 p.u. Other Income, Yield ₹0.02, 1% 5.7% Declaration Date Record Date Payment Date Key D
Slide 21: Low Leverage Offers Balance Sheet Headroom for Future Growth
Low Leverage Offers Balance Sheet Headroom for Future Growth ₹ 70,908Mn 22.6%% INR 5,480 Mn 8.07%% 3.8 x 3.7 x Net Debt to Undrawn Committed Cost of Debt Interest Coverage Net Debt (1) Net Debt to EBITDA(5) Market Value (1) Facilities (p.a.) Ratio(6) Diversified debt Book with a mix of debentures an
Slide 22: Our Markets
04 Our Markets mindspacereit.com 17
Slide 23: Indian Office Sector: Riding the Winds of Favorable Trends
Indian Office Sector: Riding the Winds of Favorable Trends Emerging trends Rising GCC Return to in India’s Office Domestic landscape Office Market Occupiers c. 50 msf c. 36% c. 36.1% 75%-85% Net absorption in % contribution of % share in overall Net Physical Occupancy CY2024(1) GCCs in office absorp
Slide 24: GCCs: India a preferred destination
GCCs: India a preferred destination c. 50% 67 msf 1.9 Mn c. 85% % share of India in Total space leased GCC employees in Lower average global GCC by GCCs since India(1) salary of engineers market(1) 2022-2024(2) viz-a-viz developed countries(3) GCC Growth forecast 300 Factors driving GCC leasing in I
Slide 25: Hyderabad – Second largest Tech hub of India
Hyderabad – Second largest Tech hub of India Progressive government policies and Infrastructure growth are key market drivers Hyderabad’s GCC Landscape 9.5 ~10.7 Lakh msf 350+ 16% Tech workforce in Telangana Leasing activity in CY2024 GCCs in Hyderabad(2) Hyderabad’s share of all driven by Hyderabad
Slide 26: Madhapur as the preferred office market in Hyderabad
Madhapur as the preferred office market drives highest absorption in Hyderabad 80+ 2nd 75 msf 70% Rs psf (in Size) 57% share of City’s Share of net absorption since Highest rentals amongst all Largest micro market across office stock(1) CY 2019(1) micro markets India (1) m (1)i n d s p aJLL Source:
Slide 27: Mumbai Region - Infrastructure upgrades driving office demand
Mumbai Region - Infrastructure projects upgrades driving office demand uptick Navi Mumbai – A Preferred Location with Accessible Talent 136 msf top 3 7.2 msf Ranked amongst in terms of overall quality of living in India 3 Ranked rd , 2nd time in a row, in cleanliness index(2) in India Completed Stoc
Slide 28: Pune - Thriving Office Market with Excellent Social Infrastructure
Pune - Thriving Office Market with Excellent Social Infrastructure SBD East Micro Market(2) 83 msf ~3.8 msf 47 msf 57% Completed Stock as on Avg. annual net absorption CY2024( (1) since CY 2019 (1) 56% share of City’s Share of net absorption office stock(1) since CY 2019(1) 85-90 Pune Airport capaci
Slide 29: Chennai - One of the key growth markets
Chennai - One of the key growth markets South-West Micro Market(2) 78 msf ~3.6 22 msf 35% msf Completed Stock as on Average annual net 27% share of City’s Share of net absorption CY2024(1) absorption since 2019(1) office stock(1) since 2019 (1) Highest ever net leasing in Chennai in CY2023 6.6 Chenn
Slide 30: Our Franchise & Portfolio
05 Our Franchise & Portfolio mindspacereit.com 25
Slide 31: Sponsored by One Of India's Leading Real Estate Group
Sponsored by One Of India’s Leading Real Estate Group Over 6 Decades Pan India INR 463 Bn (5) of experience Market Capitalization presence of 3 listed entities Office Hospitality Malls Residential Retail Developed residential Operates 280+ retail Leasable Area >50 msf (1) c.4,200+ (2) keys 7 malls (
Slide 32: Mindspace REIT's Presence in Key Office Markets
Mindspace REIT’s Presence in 4 Key Office Markets Located strategically in established office micro-markets Mumbai Hyderabad Region 14.4 msf 13.8 msf 34.8 msf Total Leasable Area Presence in Presence in Malad-Goregaon Madhapur and micro-market Navi Mumbai IT Corridor markets Mumbai ` Pune Hyderabad
Slide 33: Delivered Robust Performance
Delivered Robust Performance Cumulative distribution of INR 81.8 p.u. since listing 21.9% c. 20 msf (1) Releasing Spread on Gross Leasing 13.1 msf INR 48.5 Bn 13.6 % Total distribution(3) Annualized returns(7) 2.7 msf 8.07 % p.a.p.m. Delivered New Cost of Debt as on 31 Developments Dec 24(5) 6.6% CA
Slide 34: High Quality Office portfolio in Prime Locations (1/5)
High Quality Office portfolio in Prime Locations (1/5) Mindspace Madhapur: Largest Business Park in Hyderabad 13.2 msf 9.6 msf 96.7% Leasable Area Completed Area Committed Occupancy m i n das Data s pofa 31-Dec-24 cereit.com 29
Slide 35: High Quality Office portfolio in Prime Locations (2/5)
High Quality Office portfolio in Prime Locations (2/5) Commerzone Kharadi, Pune 3.0 msf Leasable Area 1.9 msf Completed Area 100.0% Committed Occupancy Commerzone Yerwada, Pune 1.7 msf Leasable Area 1.7 msf Completed Area 89.1% Committed Occupancy m i n das Data s pofa 31-Dec-24 cereit.com 30
Slide 36: High Quality Office portfolio in Prime Locations (3/5)
High Quality Office portfolio in Prime Locations (3/5) The Square Nagar Road, Pune 0.8 msf Leasable Area 0.8 msf Completed Area 100.0% Committed Occupancy Commerzone Porur, Chennai 1.1 msf Leasable Area 1.1 msf Completed Area 100.0% Committed Occupancy m i n das Data s pofa 31-Dec-24 cereit.com 31
Slide 37: High Quality Office portfolio in Prime Locations (4/5)
High Quality Office portfolio in Prime Locations (4/5) Mindspace Airoli East, Navi Mumbai 7.2 msf Leasable Area 4.9 msf Completed Area 78.4% Committed Occupancy Mindspace Airoli West, Navi Mumbai 6.4 msf Leasable Area 5.3 msf Completed Area 87.3% Committed Occupancy m i n das Data s pofa 31-Dec-24 c
Slide 38: High Quality Office portfolio in Prime Locations (5/5)
High Quality Office portfolio in Prime Locations (5/5) Mindspace Malad, Mumbai 0.8 msf Leasable Area 0.8 msf Completed Area 98.6% Committed Occupancy The Square BKC, Mumbai 0.1 msf Leasable Area 0.1 msf Completed Area 100.0% Committed Occupancy m i n das Data s pofa 31-Dec-24 cereit.com 33
Slide 39: Diversified Portfolio of Marquee Tenants
Diversified Portfolio of Marquee Tenants Top 10 tenants contributing 30.0% (Dec-24) vs. 28.8% (Sep-24) Diversified tenant mix across sectors Top 10 tenants Gross Contracted Rentals contribution (30.0%) (1) (1) % split by Gross Contracted Rentals % of total Gross Contracted Rentals # of parks L&T 3.6
Slide 40: Marquee Tenant Base
Marquee Tenant Base Leading MNCs and Fortune 500 companies across sectors Technology Technology Financial Services Financial Services Diversified Diversified Accenture Wipro Barclays BNY Mellon Smartworks Verizon Cognizant Atos India UBS Fiserv Allstate Hitachi energy Qualcomm Highradius NCR Princet
Slide 41: Re-energizing Parks
06 Re-energizing Parks mindspacereit.com 36
Slide 42: Dynamic Environment, Vibrant Workspaces
Dynamic Environment, Vibrant Workspaces mindspacereit.com 37
Slide 43: Energized Landscape for Business Excellence
Energized Landscape for Business Excellence mindspacereit.com 38
Slide 44: Infusing modern design elements to elevate experience
Infusing modern design elements to elevate experience Tailoring common areas to meet the evolving preferences of tenants mindspacereit.com 39
Slide 45: Experience Center: An Inclusive Ecosystem
Experience Center: An Inclusive Ecosystem for all Lifestyle & Business Needs Enhancing the Mindspace offering with a modern club facility with top notch amenities c. 130 ksf Exclusive and premium space Perspective Offers enriching entertainment, sports, lifestyle, recreation and dining experiences m
Slide 46: Curated mix of amenities enhancing work place experience
Curated mix of amenities enhancing work place experience Badminton | Squash | Indoor-Outdoor Cafes Bar and Lounge Tennis Yoga | Meditation | Aerobic State of the art gym facility Half Olympic Size Lap Pool Rooms mindspacereit.com 41
Slide 47: SOCIALising at Vantage Café in the Park
SOCIALising at Vantage Café in the Park The first-ever SOCIAL in One of the largest SOCIAL Hyderabad OUTLETS in the country mindspacereit.com 42
Slide 48: Tenant Engagement Initiatives, Designed to Build Camaraderie
Tenant Engagement Initiatives, Designed to Build Camaraderie NAVRATRI FIESTA NAVRATRI FIESTA NAVRATRI FIESTA NAVRATRI FIESTA NAVRATRI FIESTA MPL – INDOOR EDITION MPL – INDOOR EDITION MPL – INDOOR EDITION MPL – INDOOR EDITION mindspacereit.com 43
Slide 49: Tenant Engagement Initiatives, Designed to Build Camaraderie
Tenant Engagement Initiatives, Designed to Build Camaraderie 1 NAVRATRI FIESTA 2 MPL – INDOOR EDITION Over 21,000+ employees across 5 of our business parks attended the events mindspacereit.com 44
Slide 50: Value Creation via ESG
07 Value Creation via ESG mindspacereit.com 45
Slide 51: ESG - Key Highlights
ESG - Key Highlights Scope 1+2 emission 32.4% 56,645 Renewable energy mix tCO2e for Q3FY25 (30.4% reduction from FY20 baseline)(2) 12,58,068 KL 61.4% of material(2) Water Recycled(2) sourced using sustainable sourcing INR 18.5 Bn (3) INR 6.5 Bn of Cumulative Green / Sustainability linked Bond Sustai
Slide 52: Key Achievements and Awards
Key Achievements and Awards Mindspace REIT: Real Estate Excellence • Scored 99/100 in Office Development Benchmark • Receives the coveted title of ‘Global Listed Sector Leader – Office Development Benchmark’, for the 2nd consecutive year • Ranked 3rd in Asia in ‘Listed Companies’ category for commer
Slide 53: Focus On High Corporate Governance Standards
Focus On High Corporate Governance Standards Strong governance framework complemented by partnership with leading institutional investors Mindspace REIT: Top-Notch Standards Seven Member Board / Independent • 57% independent directors on the Board Chairman • Manager can be removed with 60% approval
Slide 54: Shareholding Pattern
08 Shareholding Pattern mindspacereit.com 49
Slide 55: Unitholding Pattern as on 31 Dec 2024
Unitholding Pattern as on 31 Dec 2024 Unitholding Summary INR 21,427 Cr 36.5% Market Cap(1) % Free- float 593 Mn units Unitholding Pattern (Market Cap : INR 214 Bn) (1) MF NIIs AIF 5.5% 10.3% 0.6% Insurance 3.4% DIIs Sponsors & Sponsor Public 3.1% Group (Others) Total 63.5% 36.5% FIIs Unitholders 13
Slide 56: Annexure
09 Annexure mindspacereit.com 51
Slide 57: Stable NOI Growth Driven by Effective Cost and Revenue Management
Stable NOI Growth Driven by Effective Cost and Revenue Management Revenue from Operations (INR Mn)(1) NOI (INR Mn)(1)(2) % of NOI Assets Q3 FY25 Q3 FY24 9M FY25 Q3 FY25 Q3 FY24 9M FY25 Q3 FY25 Mindspace Airoli (E) 979 982 2,995 709 745 2,250 14% Mindspace Airoli (W) 1,060 869 2,927 804 640 2,171 15%
Slide 58: Mindspace REIT Structure
Mindspace REIT Structure Unitholders Investment in Distribution Mindspace REIT Investment Manager Trust Trustee K Raheja Corp Mindspace Business Axis Trustee Services Investment Managers Parks REIT Limited Private Limited(3) SPV: K Raheja IT SPV: Avacado SPV: Mindspace SPV: KRC SPV: Horizonview SPV:
Slide 59: Portfolio Summary
Portfolio Summary 26.8 msf of Completed area with WALE of 7.2 years and MTM potential of 3.9%(1) Total Committed WALE on Leasable Completed UC/Future Occupancy In-place Rent Asset Occupancy area Area Area (msf) Area (msf) (%) (INR psf) (%) (years) (msf) Mindspace Airoli East 7.2 4.9 2.3 70.5% 78.4%
Slide 60: Breakup of Lease Expiry Profile
Breakup of Lease Expiry Profile Q4 FY25 FY26 FY27 Asset Area % of Gross Rent at Area % of Gross Rent at Area % of Gross Rent at Expiring Contracted Expiry Expiring Contracted Expiry Expiring Contracted Expiry (1) (msf) Rentals (INR psf) (msf) Rentals (INR psf) (msf) Rentals (INR psf) Mindspace Airol
Slide 61: Key Financial Metrics
Key Financial Metrics Delivered consistent growth on key financial metrics Revenue (INR bn) NOI (INR bn) (1,3) 6.4 6.0 6.2 6.2 6.0 6.0 5.9 5.5 5.2 4.9 4.8 5.0 5.0 0.12(2) 5.0 (0.09)(2) 4.8 5.9 0.12 (2) 5.6 4.5 4.8 4.7 4.5 4.0 3.5 3.0 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Q3 FY25 Q1 FY24 Q2
Slide 62: Balance Sheet as on 31-Dec-24
Balance Sheet as on 31-Dec-24 Balance Sheet (INR Mn)(1) Dec-24 Sep-24 Notes 1. All numbers are prior to minority Sources of Funds adjustment Total Equity 1,44,285 1,46,052 2. Other Liabilities primarily include Trade Payables, Capital Creditors, Retention Sub-Total 1,44,285 1,46,052 Money, Advances
Slide 63: Debt Maturity Schedule as on 31-Dec-24
Debt Maturity Schedule as on 31-Dec-24 Interest Wt. Avg. Principal Repayment Description Fixed/ Total Undrawn Principal Rate Maturity FY31 & (INR Mn) Floating Facility Facility O/S Q4 FY25 FY26 FY27 FY28 FY29 FY30 Total (p.a.p.m) (Years) Beyond At REIT Level NCD (Tranche 4) Fixed 5,000 - 5,000 7.9%
Slide 64: De-risked Portfolio with ~90.0% Completed Assets
De-risked Portfolio with ~90.0% Completed Assets Project wise Market Value breakup (1) Completed Assets form 90.0% of the Market U/C & Total % of Value(3) Completed Asset Future Dev. Value Total (INR Mn) Under (INR Mn) (INR Mn) (%) Construction Mindspace Airoli East(4) 45,639 3,238 48,877 15.6% 7.4%
Slide 65: 15 Research Houses Covering Mindspace REIT
15 Research Houses Covering Mindspace REIT Research House Analyst Email Id Ambit Capital Karan Khanna karan.khanna@ambit.co Avendus Spark Girish Choudhary girish.c@avendusspark.com Axis Capital Pritesh Sheth pritesh.sheth@axiscap.in Bank of America Kunal Tayal kunal.tayal@bofa.com CITI Research Raji
Slide 66: Key Definitions
Key Definitions Asset SPVs Collectively, Avacado, Gigaplex, Horizonview, Intime, KRIT, KRC Infra, MBPPL and Sundew Occupied Area + Committed Area Committed Occupancy (%) Completed Area Committed Area Completed Area which is unoccupied but for which letter of intent/ agreement to lease have been sign
Slide 67: Thank You
Thank You Investor Relations Enquiries: Nitin Garewal (Finance & Investor Relations) Email id: ir@mindspacereit.com mindspacereit.com 62
Mindspace Business Parks REIT — Q3 FY25 Earnings Presentation on 6ix