Brookfield India Real Estate Trust · NSE:BIRET.RR
Brookfield India Real Estate Trust — Q1 FY2024 Earnings Presentation
38 slides from Brookfield India Real Estate Trust's earnings presentation, Aug 14, 2023
Slide 1: Q1 FY2024 Investor Update
Brookfield India Real Estate Trust Q 1 F Y 2 0 2 4 – I N V E S T O R U P D AT E AU G U S T 1 4 , 2 0 2 3 CANDOR TECHSPACE G2, GURUGRAM
Slide 2: Disclaimer
Disclaimer By reading this presentation (the “Presentation”), you agree to be bound by the following limitations: This Presentation is for information purposes only without regard to specific objectives, financial situations or needs of any particular person, and should not be disclosed, reproduced,
Slide 3: On the Path of Growth
Brookfield India Real Estate Trust | On the Path of Growth India’s first 100% institutionally managed REIT; on track to complete the acquisitions of Downtown Powai and Candor Techspace G1, significantly increasing scale and diversification AT IPO CURRENT PORTFOLIO PRO-FORMA PORTFOLIO (March 2021) (J
Slide 4: Pro-forma Portfolio
Brookfield India Real Estate Trust | Pro-forma Portfolio Our operating area will increase by 44% upon completion of the transformative acquisitions of Downtown Powai and Candor Techspace G1 Delhi NCR (15.2 MSF) 25.2 MSF 20.6 MSF Gurugram 7.6 0.2 TOTAL AREA OPERATING AREA Noida 5.7 1.6 Total 13.4 1.8
Slide 5: High Quality Properties in Gateway Cities
High Quality Properties in Gateway Cities Assets Under Acquisition (Completion targeted in Q2 FY2024) One of the largest campus-style offices in Gurugram Largest office campus in Noida Prime office portfolio in a 250-acre integrated township CANDOR TECHSPACE G2 CANDOR TECHSPACE N2 DOWNTOWN POWAI, MU
Slide 6: Acquisition Update
Acquisition Update DOWNTOWN POWAI, MUMBAI
Slide 7: Increasing our Operating Scale
Increasing our Operating Scale Addition of two highly complementary, fully built properties to our portfolio Area (in MSF) Leased Area Metrics Area Committed / Office WALE In-place Rent Asset Operating Total in MSF Econ. Occ. %(1) Tenants (Yrs.) (Rs PSF) Kensington 1.6 1.6 1.2 79% 6 12.4 Rs 102 G2 3
Slide 8: Significant Growth Potential
Significant Growth Potential 16% embedded growth headroom in existing assets. Our income will further increase through new acquisitions NOI GROWTH POTENTIAL (RS MILLIONS) Rs 8,900 - 9,100 Rs 20,496 - 20,816 Rs 1,320 - 1,410 Rs 11,596 - 11,716 Rs 190 - 220 Rs 10,086 (1) (2) (3) (4) Contracted Adj. Va
Slide 9: Diversifying the Portfolio
Diversifying the Portfolio Mumbai and Gurugram will become the largest geographies by value in our portfolio; top five tenant concentration will reduce by ~20% and the share of BFSI will increase by ~10% CURRENT PORTFOLIO PRO-FORMA PORTFOLIO (June 2023) (June 2023) Kolkata Kolkata 10% 16% Gurugram 2
Slide 10: Fund Raising Update
Fund Raising Update Secured Rs 27 billion to finance the acquisitions of Downtown Powai and Candor Techspace G1; on track to complete the transactions in Q2 FY2024 SOURCE OF FUNDS UNITHOLDING PATTERN(2) Institutional Preferential 439 Placement(1) Issuance(2) 335 ISSUE SIZE Rs 23.1 B Rs 4.0 B 56% 46%
Slide 11: Successful Institutional Placement
Successful Institutional Placement of Rs 23 Billion Robust participation from both existing shareholders and new investors leading to a ~60% increase in free float and significant diversification of the investor base INVESTOR PROFILE FREE FLOAT Million Units Foreign Portfolio Mutual Funds 59 Investo
Slide 12: Q1 FY2024 Highlights
Q1 FY2024 Highlights CANDOR TECHSPACE N1, NOIDA
Slide 13: Q1 FY2024 | Business Highlights
Q1 FY2024 | Business Highlights We witnessed leasing demand of 0.3 MSF this quarter • Achieved 298,000 SF of gross leasing with 76% of the area being leased to GCC’s 0.3 MSF 87% • Additionally, 104,000 SF of LOI’s are under execution, Leasing Update Gross Effective Economic comprising 82,000 SF in N
Slide 14: Q1 FY2024 | Financial Highlights
Q1 FY2024 | Financial Highlights 5% increase in operating income versus Q1 FY2023 Growth vs Rs Million Q1 FY2024 Q1 FY2023 Operating Lease • Rs 79 million (3.9%) YoY increase due to new leasing Rs 2,113 4% and contractual escalations, net of vacancies Rentals (OLR) • Rs 231 million (7.9%) YoY increa
Slide 15: Q1 FY2024 | Distributions
Q1 FY2024 | Distributions DISTRIBUTION PER UNIT COMPONENTS Rs 1,642 million DISTRIBUTION (Q1 FY2024) Rs 0.04 , 1% Rs 3.85 DISTRIBUTION PER UNIT (DPU) NDCF of Rs 4.91 per unit without considering the impact of units allotted on August 2, 2023, following the QIP August 23, 2023 Rs 2.02 , 52% Rs 1.79 ,
Slide 16: Capital Structure and Liquidity
Capital Structure and Liquidity Backed by high quality assets and robust cash flows, our long duration borrowings maintain a AAA credit rating, attract competitive costs and carry a low refinancing risk COMMERCIAL PAPER KEY METRICS (INDICATIVE TERMS) DEBT MATURITY PROFILE Rs 54.1B (% OF OUTSTANDING
Slide 17: Business & Financial Updates
Business & Financial Updates CANDOR TECHSPACE K1, KOLKATA
Slide 18: Leasing Success
Leasing Success 93% of gross leasing included expansion and renewal of existing tenants Q1 FY2024 GROSS LEASING BREAKDOWN Rs 64 PSF AVERAGE RENT ON GROSS LEASING(1)(2) 7% 14% 9.5 Yrs. AVERAGE TERM ON GROSS LEASING(1)(2) 0.3 MSF Barclays 79% 42% RE-LEASING SPREAD New Tenants Existing Tenants 1.2 MSF
Slide 19: Ramp-up of Physical Occupancy
Ramp-up of Physical Occupancy ~8x improvement in physical occupancy since January 2022 driven by “return-to-office” % PHYSICAL OCCUPANCY 66% 64% 63% 62% 62% 52% 53% 50% 50% 43% 33% 33% 26% 21% 21% 16% 9% 8% Jan-22 Feb-22 Mar-22 Apr-22 May-22 Jun-22 Jul-22 Aug-22 Sep-22 Oct-22 Nov-22 Dec-22 Jan-23 Fe
Slide 20: Deep Rooted Tenant Relationships
Deep Rooted Tenant Relationships High-quality tenant roster diversified across multiple industry sectors SECTOR DIVERSIFICATION OF TENANTS(1) TOP 10 TENANTS(1) % Gross % Area Tenant # Parks Contracted Leased Others, 10% Rentals Telecom, Technology, 44% Accenture 3 16% 14% 4% TCS 3 15% 14% Hardware,
Slide 21: Lease Expiry Profile
Lease Expiry Profile Portfolio has a well staggered lease expiry profile and provides an opportunity to capture an attractive mark-to-market spread in the near term LEASE EXPIRY SCHEDULE KEY HIGHLIGHTS Expiries (MSF) Achieved/Expected Renewals (MSF) Cumulative Expiry (% of Rentals) • Renewed 235,000
Slide 22: Property Income | Walkdown
Property Income | Walkdown MILLIONS Q1 FY2024 Q1 FY2023 KEY DRIVERS Income from Operating Lease • Rs 79 million (3.9%) YoY increase due to new leasing and Rs 2,113 Rs 2,034 contractual escalations, net of vacancies Rentals (OLR) • Rs 151 million (17.3%) YoY increase primarily due to higher (+) CAM /
Slide 23: NDCF | Walkdown
NDCF | Walkdown Millions Q1 FY2024 Millions Q1 FY2024 Income from Operating Lease Rentals Rs 2,113 NDCF (SPV Level)(2) Rs 2,213 CAM / Other Revenue 1,028 Interest on Shareholder Debt 800 Revenue from Operations Rs 3,141 Dividends - CAM / Other Direct Expenses (866) Repayment of Shareholder Debt 1,46
Slide 24: Summary Balance Sheet
Summary Balance Sheet Our business is well-capitalized, backed by a strong balance sheet MILLIONS JUNE 30, 2023 Liabilities and Equity Total Equity 81,393 Borrowings(1) 55,797 Security Deposits 5,107 Other Liabilities 3,472 Total 145,769 Assets Investment Property 133,387 Investment Property Under D
Slide 25: Information Supplement
Information Supplement CANDOR TECHSPACE N2, NOIDA
Slide 26: Brookfield: One of the World's Largest Real Estate Portfolios
Brookfield: One of the World’s Largest Real Estate Portfolios With ~$270 B in real estate AUM and ~30,000 employees across 30+ countries, Brookfield owns, operates and manages one of the world’s largest, highest quality portfolios BROOKFIELD PLACE, NEW YORK POTSDAMER PLATZ, BERLIN BROOKFIELD PLACE,
Slide 27: Brookfield's Real Estate Footprint in India
Brookfield’s Real Estate Footprint in India Brookfield is one of the largest real estate investors in India with a high-quality office portfolio spanning 50 MSF (including Brookfield India REIT) BROOKFIELD INDIA REAL ESTATE – KEY FACTS OTHER INDIA OFFICE PORTFOLIO (OUTSIDE REIT) $8B 50 MSF ASSETS UN
Slide 28: Robust Growth Pipeline
Robust Growth Pipeline Pro-forma for assets under acquisition, BIRET’s portfolio will grow to over 25 MSF, with our Sponsor Group continuing to own another 25 MSF across India Area (in MSF) G2 Delhi N1, N2 Future (Gurugram) NCR (Noida) Total Operating Dev. G1 Current Portfolio 18.7 14.3 4.4 (Gurugra
Slide 29: Progress on Net Zero
Progress on Net Zero We are actively tracking our emissions and are closely working with all our stakeholders to achieve a Net Zero carbon future by 2040 GREENHOUSE GAS EMISSIONS (‘000 Mt CO2e)(1)(2) ENERGY CONSUMPTION (MILLION UNITS)(1) Scope 2 Scope 1 3 178 5 1 1 137 68 103 95 45 0 36 36 38 10 FY2
Slide 30: Detailed Lease Expiry Schedule
Detailed Lease Expiry Schedule % of Gross Rentals In-place rent at Expiry Year / Asset Area Expiring (‘000 SF) (Asset / Portfolio) (Rs PSF)(1) Q2-Q4 FY2024E Kensington - - - G2 317 10% 87 N1 93 4% 49 N2 153 6% 54 K1 61 3% 48 Total 624 6% Rs 71 FY2025E Kensington 41 5% Rs 152 G2 115 3% 112 N1 304 14%
Slide 31: Q1 FY2024: Occupancy Bridge
Q1 FY2024: Occupancy Bridge ASSET MARCH 31, 2023 JUNE 30, 2023 OPERATING LEASED COMMITTED NEW GROSS OPERATING LEASED COMMITTED AREAS IN ‘000 SF RENEWALS AREA AREA OCCUPANCY LEASING EXPIRIES AREA AREA OCCUPANCY Kensington 1,563 1,357 87% - (123) - 1,563 1,234 79% G2 3,918 3,311 85% 38 (47) - 3,920 3,
Slide 32: Q1 FY2024: New leasing & Renewals
Q1 FY2024: New leasing & Renewals ASSET NEW LEASING RENEWALS GROSS LEASING AREAS IN ‘000 SF AREA RENT PSF PM(1) AREA RENT PSF PM(1) AREA RENT PSF PM(1) Kensington - - - - - - G2 38 91 - - 38 91 N1 25 - 235 59 260 59 N2 - - - - - - K1 - - - - - - Total 63 Rs 91 235 Rs 59 298 Rs 64 32 (1) Rents are gi
Slide 33: Property Income | Consolidation Details (Q1 FY2024)
Property Income | Consolidation Details (Q1 FY2024) INCOME FROM REVENUE FROM MILLIONS OPERATING LEASE NET OPERATING INCOME (NOI)(1) OPERATIONS RENTALS (OLR) Q1 FY2024 Q1 FY2023 Q1 FY2024 Q1 FY2023 Q1 FY2024 % OLR Q1 FY2023 % OLR Kensington Rs 415 438 Rs 446 476 Rs 383 92% 413 94% G2 610 576 908 837
Slide 34: Ongoing Capex and Upgrades
Ongoing Capex and Upgrades Rs 2.7 billion of capex projects underway across new tower developments and upgrades to existing towers. Capex including interest during construction to be financed through debt ESTIMATED PENDING COSTS ONGOING PROJECTS(1) COMPLETION DATE (MILLIONS) Asset Upgrades/Tenant Im
Slide 35: Target Assets Holding Structure
Target Assets Holding Structure TRUSTEE MANAGER Axis Trustee Services Brookprop Management Limited Services Private Limited 100% 100% 100% 100% 100% 50% 50% 50% 50% OPERATIONAL ASSET SPV SERVICE ASSET SPV ASSET SPV ASSET SPV ASSET SPV ASSET SPV PROVIDER Candor Kolkata Shantiniketan Seaview Kairos Pr
Slide 36: Research Coverage
Research Coverage RESEARCH HOUSE ANALYST EMAIL ID Ambit Karan Khanna Karan.Khanna@ambit.co Axis Capital Samar Sarda Samar.Sarda@axiscap.in BofA Securities Kunal Tayal Kunal.Tayal@bofa.com Citi Atul Tiwari Atul.Tiwari@citi.com CLSA Kunal Lakhan Kunal.Lakhan@clsa.com HSBC Bank Puneet Gulati PuneetGula
Slide 37: Glossary (1/2)
Glossary (1/2) Gross Asset Value / Asset Value The market value as determined by the Valuer as of March 31, 2023 (Occupied Area + Completed Area under Letters of Intent) Committed Occupancy In % Completed Area Weighted Average Lease Expiry based on area. Calculated assuming tenants exercise all thei
Slide 38: Glossary (2/2)
Glossary (2/2) Net distributable cash flows (non-GAAP measure). Please refer to pg. 285-287 of the Offer NDCF Document for calculation methodology Sum of Leased Areas and any eligible areas under any income Effective Economic Occupancy support arrangement (excluding Leased Areas) In % Operating Area
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