Mindspace Business Parks Reit · NSE:MINDSPACE.RR
Mindspace Business Parks Reit — Q3 FY2021 Earnings Presentation
47 slides from Mindspace Business Parks Reit's earnings presentation, Feb 10, 2021
Slide 1: Q3 FY 2021 Results Presentation
Mindspace Business Parks REIT Q3 FY 2021 Results Presentation 10th Feb 21 mindspacereit.com 1
Slide 2: 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 3: Table of Contents
Table of Contents Key Updates 04 Portfolio Overview 09 Projects Update 17 Value Creation via ESG 21 Financial Update 25 Price Performance & Unitholding 29 Market Overview 32 Annexures 37 Note: 1. The consolidated financial results include financial results of Asset SPVs for a cumulative five month p
Slide 4: Key Updates
Key Updates mindspacereit.com 4
Slide 5: Key Updates for Q3 FY21
Key Updates for Q3 FY21 Operational • Gross Leasing of 1.0 msf at an average rent of INR 60 psf/month • Committed Occupancy of 86.9%(1) • Same Store Committed Occupancy of 89.9% • Re-leasing spread of 13.3%(2) on 0.9 msf Re-leased during the quarter • Collections of more than 99% of Gross Contracted
Slide 6: Quality Portfolio with Attractive In-Place Rent Backed by Strong Tenant Base
Quality Portfolio with Attractive In-Place Rent Backed by Strong Tenant Base 0.96 msf leases signed across 16 tenants, includes 0.88 msf Re-leased at 13.3%(1) Re-leasing spread and 0.07 msf of new leases at market rent 0.96 msf INR 60 psf/month 13.3% Q3 FY21 Gross Leasing Average Rent for Area Lease
Slide 7: Delivered Sustainable Financial Performance
Delivered Sustainable Financial Performance Performance driven by revenue management and cost efficiencies Revenue from Key points: NOI Operations (1) (INR Mn) (INR Mn) • NOI growth from Q2 FY21 to Q3 FY21: 6.3% 9M FY21 12,018 10,162 • NOI growth in 9M FY21 over FY20 on annualized terms(2): 10.5% Q3
Slide 8: Mindspace REIT Declares its First Distribution
Mindspace REIT Declares its First Distribution Q3 Distribution of INR 2,835 Mn, INR 4.78 per unit representing c.100% payout ratio Key Dates Distribution Details Period Oct 20 to Dec 20 Distribution Amount INR 2,835 Mn Outstanding Units 593,018,182 Declaration Date 10 Feb 21 Distribution per unit IN
Slide 9: Portfolio Overview
Portfolio Overview mindspacereit.com 9
Slide 10: Portfolio Overview
Portfolio Overview Mindspace REIT is one of the largest Grade-A office portfolios in India 29.5 msf INR 55.2 psf Total Leasable Area(1) In-place Rent 89.9% 86.9% Same Store Committed Committed Occupancy Occupancy 5.8 Pune (16.9%) Mumbai Region (41.0%) 15.0% years Hyderabad (39.3%) Mark to Market Pot
Slide 11: Five Integrated Business Parks
Five Integrated Business Parks Mindspace Madhapur Mindspace Airoli East Hyderabad | 10.6 msf Mumbai Region | 6.8 msf Completed Area: 10.0 msf; Committed Occupancy: 95.2% Completed Area: 4.7 msf; Committed Occupancy: 93.2% Mindspace Airoli West Gera Commerzone Kharadi Commerzone Yerwada Mumbai Region
Slide 12: Five Quality Independent Office Assets
Five Quality Independent Office Assets Commerzone Porur Paradigm, Mindspace Malad Chennai | 0.8 msf (1) Mumbai Region | 0.7 msf Completed Area: 0.8 msf; Leased: 43 ksf Completed Area: 0.7 msf; Committed Occupancy: 82.4% The Square, BKC Mindspace Pocharam The Square, Nagar Road Mumbai Region | 0.1 ms
Slide 13: Marquee Tenant Base
Marquee Tenant Base Leading MNCs and Fortune 500 companies across sectors Technology Financial Services Diversified Technology Financial Services Diversified Accenture Wipro Fiserv Barclays Amazon Qualcomm Facebook Verizon UBS BNY Mellon Worley Parson Here Solutions Bank of America Schlumberger 82.9
Slide 14: Diversified Portfolio of Marquee Tenants
Diversified Portfolio of Marquee Tenants Top 10 tenants contributing 40.9% of Gross Contracted Rentals Diversified tenant mix across sectors Top 10 tenants Gross Contracted Rentals contribution (40.9%) (1) % split by Gross Contracted Rentals (1) % of total Gross Contracted Rentals # of parks Others
Slide 15: Lease Expiry Profile
Lease Expiry Profile Active discussions on with existing and new tenants for renewal / Re-leasing Tenant uncertainty over future lease commitments Track record of achieving Re-leasing spread likely to persist for few quarters across parks Area expiry – YoY Area Re-leased (since Apr 17) msf msf 51.0
Slide 16: Ability to Attract New Tenants along with Continued Tenant Retention
Ability to Attract New Tenants along with Continued Tenant Retention 9.6 msf leased since Apr 17, including 4.4 msf at 26.4% Re-leasing spread New Area leased Existing Area Re-leased / Vacant Area leasing % split by area (1) % split by area (2) (3) New Tenants 13.1% Existing Tenants 5.1 msf 4.4 msf
Slide 17: Projects Update
Projects Update mindspacereit.com 17
Slide 18: Development Progress
Development Progress Hyderabad Mumbai Region Pune Mindspace Madhapur (B22) Mindspace Airoli, West (B9) Commerzone Kharadi (B5) Leasable area: 0.1 msf Leasable area: 1.0 msf Leasable area: 0.7 msf Status: RCC completed, Finishes Status: Façade WIP Status: Structural WIP WIP Estimated co
Slide 19: Commerzone Kharadi, Pune – Select Images
Commerzone Kharadi, Pune – Select Images Biophilic Landscape Aesthetic Lobbies along with Amphitheatre Energised Lobbies Elegant Lift Lobbies mindspacereit.com 19
Slide 20: Commerzone Porur, Chennai – Select Images
Commerzone Porur, Chennai – Select Images Elegant Setting Appealing Entry Points Spacious Lobbies Vibrant Walkways mindspacereit.com 20
Slide 21: Value Creation via ESG
Value Creation via ESG mindspacereit.com 21
Slide 22: Key Achievements and Awards
Key Achievements and Awards Awarded 35(1) Five Star rating across 4 parks Green Buildings Sword of Honour for 2 parks COVID 19 Assurance Statement for 6 parks >17.3 msf Environment friendly project Total “Green of the year - By Estate Awards Building” Footprint Mindspace Airoli West 100% Most enviro
Slide 23: Our Commitment to Build an ESG Centric Ecosystem
Our Commitment to Build an ESG Centric Ecosystem Renewable Energy Waste Water through Management Efficiency Solar PV Panels Green Preserving Sustainable Sewage Nature Development Treatment Electrical Employee & Robust charging Tenant Corporate stations Engagement Governance Integration of sustainabi
Slide 24: Key ESG Initiatives
Key ESG Initiatives Durgam Cheruvu Lake Workers’ Welfare Energy Efficiency Makeover, Hyderabad • Partnered with TSIIC and the • Shaping the future of our • Solar power capacity of 1.6 GHMC (1) for makeover of labourers & their families, MW through PV modules on Durgam Cheruvu Lake especially childre
Slide 25: Financial Update
Financial Update mindspacereit.com 25
Slide 26: 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) NOI (INR Mn) % of NOI Assets Q2 FY21 Q3 FY21 9M FY21 Q2 FY21 Q3 FY21 9M FY21 Q3 FY21 Mindspace Airoli (E) 887 908 2,695 703 697 2,117 19.5% Mindspace Airoli (W) 484 506 1,498 374 423 1,217 11.8% Mindsp
Slide 27: Q3 FY21: NDCF Build-up
Q3 FY21: NDCF Build-up Particulars Amount (INR Mn) Revenue from Operations (1) 4,163 Property Taxes & Insurance (134 ) Other Direct Operating Expenses (1) (451) Net Operating Income (NOI) 3,578 Property Management Fees (105 ) Net Other Expenses (121) EBITDA 3,352 Cash Taxes (Net of Refunds) (378 ) W
Slide 28: Low Leverage Offers Balance Sheet Headroom for Future Growth
Low Leverage Offers Balance Sheet Headroom for Future Growth Strategy to embed a blend of short term and long-term debt with a mix of instruments 13.8% INR 5.7 Bn CRISIL : CCR AAA/Stable(1) INR 33 Bn Net Debt to Undrawn Committed ICRA : ICRA AAA (Stable)(1) Market Value(2) Net Debt Facilities Compos
Slide 29: Price Performance and Unitholding
Price Performance and Unitholding mindspacereit.com 29
Slide 30: Stable Price Performance
Stable Price Performance Included in “MSCI India Domestic Small Cap Index“ and various other MSCI and FTSE indices Price movement of Mindspace REIT since listing (1) Stock Symbol – NSE : Mindspace; BSE : 543217 160 (Nifty Realty: +53.9%) 140 120 (Nifty: +24.7%) 100 (Mindspace REIT: +16.3%) 80 07-Aug
Slide 31: Unitholding Summary & Use of Proceeds
Unitholding Summary & Use of Proceeds Unit-holder Pattern as on 31 Dec 20 Use of Proceeds General Corporate Alternative Issue Related Purposes Non Investment Expenses INR 56 Mn Institutions Funds INR 310 Mn 9.1% 1.2% Bodies Corporates (Incl. Mutual Blackstone) Funds 9.2% Total 0.3% Fresh Issue INR 1
Slide 32: Market Overview
Market Overview mindspacereit.com 32
Slide 33: Mumbai Region
Mumbai Region Grade-A Office Stock December 2020 Key Updates Worli-Lower Thane Parel 10.1% 10.5% Leasing to gain momentum in second half of 2021driven by Others BFSI, engineering and manufacturing amongst others 17.7% Supply estimated to be delayed by 1-2 quarters Andheri and Powai Stock Trans
Slide 34: Hyderabad
Hyderabad Grade-A Office Stock December 2020 Supply, net absorption and vacancy trend analysis (1) Micro-Markets : Madhapur 8.0 7.4 7.5 7.0% 6.6% Madhapur 7.0 6.0% Others 68.2% 4.7% 2.4% 6.0 5.0% 4.5 3.8 5.0 4.0 Stock 3.7 4.0% 3.5% 3.6 Peripheral 4.0 2.6% 65.6 msf East 3.0 3.0% 3.1% 2.0 1.8 2.0% 1.0
Slide 35: Pune
Pune Grade-A Office Stock December 2020 Supply, net absorption and vacancy trend analysis Micro-Market: SBD East Others 11.3% 3.0 7.0% 2.6 2.5 5.9% 2.4 2.1 6.0% PBD West 2.0 5.1% 22.7% 5.0% 1.5 2.0 1.5 3.5% 4.0% Stock 1.2 1.5 1.1 55.8 msf 3.0% 1.0 2.3% 2.0% (1) SBD West SBD East 0.5 55.3% 1.0% 10.7%
Slide 36: Chennai
Chennai Grade-A Office Stock December 2020 Supply, net absorption and vacancy trend analysis Micro-Market: South-West Others 1.8 11.0% 12.0% 19.9% 1.6 1.6 10.0% (1) South-West 1.4 24.1% 1.2 8.0% 7.1% 1.0 0.6 0.9 0.8 Stock 6.0% 0.8 4.7% 0.4 53.8 msf 0.6 0.4 0.4 4.0% 0.4 2.1% 0.1 2.0% Peripheral 0.2 S
Slide 37: Annexures
Annexures mindspacereit.com 37
Slide 38: Mindspace REIT Structure
Mindspace REIT Structure Investment Manager Trust Trustee K Raheja Corp Mindspace Business Axis Trustee Services Investment Managers Parks REIT Limited LLP SPV: K Raheja IT SPV: Avacado SPV: Mindspace SPV: KRC SPV: Horizonview SPV: Intime SPV: Sundew SPV: Gigaplex Park (Hyderabad) Properties & Tradi
Slide 39: Portfolio Summary
Portfolio Summary 23.9 msf of Completed area with Committed Occupancy of 86.9% & WALE of 5.8 years Total Leasable Completed UC/Future Committed In-place Occupancy WALE Asset Area Area Area Occupancy Rent (%) (years) (msf) (msf) (msf) (%) (INR psf) Mindspace Airoli East 6.8 4.7 2.1 92.0% 93.2% 4.5 51
Slide 40: Breakup of Lease Expiry Profile
Breakup of Lease Expiry Profile Q4 FY21 FY22 FY23 Asset Area % of Gross Rent at Area % of Gross Rent at Area % of Gross Rent at Expiring Contracte Expiry Expiring Contracte Expiry Expiring Contracte Expiry (msf) d Rentals (INR psf) (msf) d Rentals (INR psf) (msf) d Rentals (INR psf) Mindspace Airoli
Slide 41: Balance Sheet as on 31 Dec 20
Balance Sheet as on 31 Dec 20 Balance Sheet (INR Mn) 31 Dec 20 Notes Sources of Funds 1) SPV financials are consolidated starting 01 Aug 20. Acquisition of the shares of Asset Total Equity(1) 1,73,930 SPVs by Mindspace REIT has been accounted as acquisition of group of Sub-Total 1,73,930 assets. Req
Slide 42: Debt Maturity Schedule as on 31 Dec 20
Debt Maturity Schedule as on 31 Dec 20 Principal Repayment Interest Wgt. Fixed Princi FY25 Description Total Undrawn Rate Avg. /Free pal Q4 & (INR Mn) Facility Facility (p.a.p. Maturity FY22 FY23 FY24 Total Float O/S FY21 beyo m.) (Years) nd At REIT Level MREIT - MLD 5,000 Fixed - 5,000 6.60% 1.3 -
Slide 43: De-risked Portfolio with 94% Completed Assets
De-risked Portfolio with 94% Completed Assets Project wise Market Value breakup(1) Completed Assets form 94% of the Market Value(1) Under Total Constru % of Complet Value Asset ction Total ed (INR Completed Under (INR (%) 94% (INR Mn) Mn) Construction Mn) 4% Mindspace Airoli East 40,644 1,781 42,425
Slide 44: ROFO Assets to Add Further Scale And Growth
ROFO Assets to Add Further Scale And Growth Strong pipeline spread across Mumbai Region, Chennai and Hyderabad Mumbai Region | 5.0 msf 3 currently Mindspace Juinagar identified assets Status: • Completed: 0.8 msf(1) • UC: 0.2 msf • Future Development: 4.0 msf Perspective Perspective Current 8.6 msf
Slide 45: Research Coverage
Research Coverage Research House Analyst Email Id Ambit Capital Karan Khanna karan.khanna@ambit.co Axis Capital Aditya Bagul aditya.bagul@axiscap.in Bank of America Kunal Tayal kunal.tayal@bofa.com CITI Research Atul Tiwari atul.tiwari@citi.com ICICI Securities Adhidev Chattopadhyay adhidev.chattopa
Slide 46: 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 47: Thank You
Thank You Investor Relations Enquiries: Deepak Aswani (Head of Corporate Finance & Investor Relations) Email id: ir@mindspacereit.com mindspacereit.com 47
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