Mindspace Business Parks Reit · NSE:MINDSPACE.RR
Mindspace Business Parks Reit — Q4 FY2022 Earnings Presentation
52 slides from Mindspace Business Parks Reit's earnings presentation, May 12, 2022
Slide 1: Q4 & FY22 Results Presentation
Q4 & FY22 Results Presentation 1 12th May 22 mindspacereit.com
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 12 Projects Update 20 Financial Update 25 Price Performance & Unitholding 30 Market Updates 33 Value Creation via ESG 38 Annexures 42 Note: 1. All the financial numbers in the presentation have been rounded off unless otherwise stated 2. Mindspace
Slide 4: Key Updates
Key Updates mindspacereit.com 4
Slide 5: Mindspace REIT – Year at a Glance (FY22)
Mindspace REIT – Year at a Glance (FY22) 1 Operating Highlights 4.5 msf 2.2 msf 2.3 msf 0.7 msf 1.6 msf Re-leased New & Vacant Successfully pre-leased Increase in Leasable area Gross Leasing (primarily include (Incl. hard option and area Leased entire U/C building (B5) at Re-development -1.0 msf & a
Slide 6: Key Highlights - Q4 FY22
Key Highlights - Q4 FY22 1 Operating Highlights Gross Leasing 0.7 msf Re-leased 0.2 msf New & Vacant Average Rent achieved INR 63 psf month Area Leased 0.5 msf 2 Financial Highlights Weighted 6.6 % p.a. NOI INR 3,960 Mn Average Cost of debt reduced from 6.7% p.a. as on 31 Dec 21 Distribution INR 2,7
Slide 7: Leasing Overview – FY22
Leasing Overview – FY22 4.5 msf leases signed across 66 tenants and achieved 31.0%(1) Re-leasing spread on 2.8 msf(1) 4.54 msf INR 67 psf/month 31.0% FY22 Gross Leasing Average Rent for Area Leased Average Re-leasing Spread(1) FY22 - Split Basis Type of Tenants (2) Area Re-leased 2.23 msf Leased to
Slide 8: Leasing Overview – Q4 FY22
Leasing Overview – Q4 FY22 0.7 msf leases signed across 10 tenants and achieved 5.7%(1) Re-leasing spread on c.0.4 msf(1) 0.72 msf INR 63 psf/month 5.7 % Q4 FY22 Gross Leasing Average Rent for Area Leased Average Re-leasing Spread(1) Q4 FY22 – Gross leasing Area Re-leased (2) 0.21 msf Leased Assets
Slide 9: Delivered Sustainable Financial Performance
Delivered Sustainable Financial Performance Performance driven by efficient cost management Growth FY21 FY22 Growth (in INR Mn) Q4 FY21 Q3 FY22 Q4 FY22 (q-o-q) (Actuals) (Actuals) (y-o-y) Revenue from (1) (1) Operations 4,265 4,404 4,666 5.9% 16,293 17,501 7.4% NOI 3,579 3,715 3,960 6.6% 13,741 14,8
Slide 10: De-risked Portfolio with 91.7% Completed Assets (by Value)
De-risked Portfolio with 91.7% Completed Assets (by Value) Statement of Net Assets at Fair Value Movement of NAV (INR p.u.) (INR Mn) Sr. No. Particulars 31 Mar 22 A Fair Value of Real Estate Assets (1) 263,996 11.9 (4.7) B Other Assets at Book Value 7,310 C Other Liabilities at Book Value 54,888 364
Slide 11: Mindspace REIT Declares Distribution for Q4 FY22
Mindspace REIT Declares Distribution for Q4 FY22 Over 90% distributions are in the form of tax-exempt dividends Distribution DPU Key Dates Yield (1) 6.7% INR 18.4 p.u. FY22 Period Jan 22 to Mar 22 Distribution Amount INR 2,734 Mn (Q4 FY22) Outstanding Units 593,018,182 Declaration Date 12 May 22 Int
Slide 12: Portfolio Overview
Portfolio Overview mindspacereit.com 12
Slide 13: Portfolio Overview
Portfolio Overview Mindspace REIT is one of the largest Grade-A office portfolios in India 31.8 msf INR 61.7 psf Total Leasable Area (1) In-place Rent (Dec 21 – 31.3 msf) 84.2% 84.3% Same Store Committed Committed Occupancy Occupancy on 23.6 msf on 24.2 msf ` Mumbai Region Hyderabad 16.3% 6.9 years
Slide 14: Five Integrated Business Parks
Five Integrated Business Parks Mindspace Madhapur Mindspace Airoli East Hyderabad | 11.7 msf Mumbai Region | 6.8 msf Completed Area: 9.9 msf; Committed Occupancy: 89.6% Completed Area: 4.7 msf; Committed Occupancy: 86.3% Mindspace Airoli West Gera Commerzone Kharadi Commerzone Yerwada Mumbai Region
Slide 15: 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; Committed Occupancy: 36.5% Completed Area: 0.7 msf; Committed Occupancy: 93.6% The Square, Nagar Road Mindspace Pocharam The Square, BKC Pune | 0.8
Slide 16: 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 Amazon Qualcomm Cognizant IBM Thryve UBS Fiserv Allstate Worley Parsons L&T AMD Nvidia B.A. Continuum Axis
Slide 17: Diversified Portfolio of Marquee Tenants
Diversified Portfolio of Marquee Tenants Reduced concentration risk with top 10 tenants contributing 36.5% (Mar 22) vs. 40.3% (Mar 21) Diversified tenant mix across sectors Top 10 tenants Gross Contracted Rentals contribution (36.5%) (1) (1) % split by Gross Contracted Rentals % of total Gross Contr
Slide 18: Lease Expiry Profile
Lease Expiry Profile Active discussions on with existing and new tenants for renewal / re-leasing Strong re-leasing achieved as macro environment Track record of achieving Re-leasing spread continues to improve across parks Area Expiry (msf) Area Re-leased (since Apr 18) msf Rent at Expiry (INR psf)
Slide 19: Ability to Attract New Tenants along with Existing Tenant Retention
Ability to Attract New Tenants along with Existing Tenant Retention 13.4 msf leased since Apr 18, including 7.4 msf at 25.8% Re-leasing spread New Area leased Existing Area Re-leased % split by area (1) % split by area (1) New Tenants 21.0% Existing Tenants 7.4 msf 6.0 msf 40.4% Leased to 25.8% Re-l
Slide 20: Projects Updates
Projects Updates mindspacereit.com 20
Slide 21: Gearing for Demand Resurgence (1/2)
Gearing for Demand Resurgence (1/2) Mumbai Region Pune Mumbai Region Mindspace Airoli West Commerzone Kharadi Mindspace Airoli West (B9) (B5) (Data Center) Leasable area: 1.1 msf Leasable area: 0.7 msf Leasable area: 0.3 msf Status: Façade work completed Status: Level 14 work in progress
Slide 22: Gearing for Demand Resurgence (2/2)
Gearing for Demand Resurgence (2/2) Pune Mumbai Region Hyderabad Commerzone Kharadi Mindspace Airoli East Mindspace Madhapur (B4) (High Street Retail And F&B ) (Club House) Leasable area: 1.0 msf Leasable area: 0.05 msf Leasable area: 0.05 msf Leasable area increase by 0.4 msf Status: Exca
Slide 23: Inauguration of Skywalk
Inauguration of Skywalk Skywalk connects Raidurg Metro Station to Mindspace Madhapur Campus Elevated Boardwalks for Ease of Movement – Phase 1 - Completed Elevated Boardwalks for Ease of Movement – Phase 1 - Completed • This striking addition to the public infrastructure was inaugurated by Honorable
Slide 24: ROFO Update - Commerzone Madhapur
ROFO Update - Commerzone Madhapur Perspective Project Details Total land area 9.07 acres Land ownership Freehold Leasable Area 1.82 msf 2 B + 2 Stilt + 1 G + 20 office Configuration floors Occupancy certificate Completion Status received in April 2022(1) Landscape design - Podium Fit-out status Tena
Slide 25: Financial Updates
Financial Updates 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 Q3 FY22 Q4 FY22 FY22 Q3 FY22 Q4 FY22 FY22 Q4 FY22 Mindspace Airoli (E) 871 923 3,527 701 737 2,837 19% Mindspace Airoli (W) 537 542 2,058 410 417 1,571 11% Mindspace Malad
Slide 27: Stable NOI Growth
Stable NOI Growth NOI growth driven primarily by rent from new area NOI bridge for FY22 INR Mn 8.2% Increase 16000 460 15000 146 113 404 14000 14,864 13000 13,741 12000 FY21 Contractuals Rent from Mark-to- Rent from (2) Rent from FY22 (1) & Others Market Opportunity Vacant Area New Area(3) % growth
Slide 28: NDCF Build-up
NDCF Build-up Particulars (INR Mn) Q4 FY22 Revenue from Operations 4,666 Property Taxes & Insurance (150) Other Direct Operating Expenses (556) Net Operating Income (NOI) 3,960 Property Management Fees (111) Net Other Expenses (208) EBITDA 3,641 Cash Taxes (Net of Refunds) (334) Working Capital chan
Slide 29: Low Leverage Offers Balance Sheet Headroom for Future Growth
Low Leverage Offers Balance Sheet Headroom for Future Growth Fixed Cost Debt forms ~46% of borrowings CRISIL: CCR AAA/Stable INR 6,824 Mn INR 42,021 Mn 15.7 % Undrawn Committed ICRA: ICRA AAA (Stable) Low Net Debt to Market Value (1) Net Debt Facilities Well staggered Debt expiry profile Facility-wi
Slide 30: Price Performance & Unitholding
Price Performance & Unitholding mindspacereit.com 30
Slide 31: Price / Volume Performance & Movement
Price / Volume Performance & Movement (1) Price movement of Mindspace REIT since listing Stock Symbol – NSE : Mindspace; BSE : 543217 (NIFTY Realty: 127.3%) (Nifty : + 55.7%) (Mindspace REIT: +26.3%) 31-Mar 22 Offer Price INR 275 p.u. Price on listing date INR 304 p.u. 6.7% Distribution yield (2) Hi
Slide 32: Unitholding Pattern as on 31 Mar 2022
Unitholding Pattern as on 31 Mar 2022 Unitholding Summary INR 20,591 Cr 37 % Market Cap (1) % Free- float 593 Mn units Unitholding Pattern (Market Cap : INR 20.6 Bn) (1) MF NIIs 9.3% NPS 0.2% Insurance 0.1% 1.1% Sponsors & Sponsor Public AIFs Group (Others) FIIs 0.6% 63% 37% 22.4% 24,683 Total Unith
Slide 33: Market Updates
Market Updates mindspacereit.com 33
Slide 34: Mumbai Region Key Updates
Mumbai Region Key Updates Grade-A Office Stock 3M CY2022 Thane Worli-Lower Infrastructure development in Mumbai region aiding demand 10.0% Parel across CBD and suburban markets 12.4% CBD demand is rising. BKC & annex and Worli, are continuing Others to witness strong demand from prime tenants co
Slide 35: Hyderabad Key Updates
Hyderabad Grade-A Office Stock 3M CY2022 Supply, net absorption and vacancy trend analysis (1) Micro-Markets : Madhapur Supply Net Absorption Vacancy Madhapur 64.1% Others 7.4 7.5 8 14.0% 2.3% 7 11.8% 12.0% 6 10.0% 10.0% Stock Peripheral 5 4.5 6.6% 4.7 4.0 79.1 msf 8.0% 3.7 3.8 3.6 East 4 3.2 3.0 2.
Slide 36: Pune Key Updates
Pune Grade-A Office Stock 3M CY2022 Supply, net absorption and vacancy trend analysis Micro-Market: SBD East Others 11.1% 3 10.0% PBD West 2.4 2.6 9.3% 9.0% 21.1% 2.5 8.0% 2.1 8.0% 2 5.9% 1.9 5.6% 1.8 7.0% 1.6 1.6 5.1% 6.0% 1.5 Stock 1.5 1.1 1.3 1.2 5.0% 60.6 msf 0.9 4.0% 3.5% 0.7 1 3.0% SBD West (1
Slide 37: Chennai Key Updates
Chennai Grade-A Office Stock 3M CY2022 Supply, net absorption and vacancy trend analysis Micro-Market: South-West Others 2.20 11.0% 11.0% 20.8% 7.1% 8.6% (1) 9.0% South-West 1.6 1.70 7.6% 25.5% 1.1 1.2 7.0% 1.20 4.6% 4.1% Stock 0.8 0.9 5.0% 0.6 0.6 56.4 msf 0.70 0.4 2.1% 0.4 0.4 0.3 3.0% 0.2 0.1 Per
Slide 38: Value Creation via ESG
Value Creation via ESG mindspacereit.com 38
Slide 39: Key Achievements and Awards
Key Achievements and Awards Awarded British Safety Council's 36 prestigious 9 ‘Sword of Honour’ Green across 7 parks Buildings Commercial Project of the year - By Realty Conclave Gera Commerzone Kharadi CREDAI’s – >18.7 msf Awards CREATE Awards 2021 Total “Green & ‘Best Commercial Building” Footprin
Slide 40: Our Commitment to Build an ESG Centric Ecosystem
Our Commitment to Build an ESG Centric Ecosystem India’s first real estate entity to Signatory of EV100 Initiative Value creation for tenants join RE100 initiative through engagement activities Durgam Cheruvu Lake Added additional floor in Great place to work Makeover, Hyderabad Govt Hospital for CO
Slide 41: 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 Six Member Board / Independent • Two-Third independent directors on the Board Chairman • Manager can be removed with 60% appro
Slide 42: Annexure
Annexure mindspacereit.com 42
Slide 43: 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 LLP SPV: K Raheja IT SPV: Avacado SPV: Mindspace SPV: KRC SPV: Horizonview SPV: Intime SPV: Su
Slide 44: Portfolio Summary
Portfolio Summary 24.2 msf of Completed area with Committed Occupancy of 84.3% & WALE of 6.9 years 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 6.8 4.7 2.1 86.3% 86.3
Slide 45: Breakup of Lease Expiry Profile
Breakup of Lease Expiry Profile FY23 FY24 FY25 Area % of Gross Rent at % of Gross Rent at Area % of Gross Rent at Asset Area Expiring Expiring Contracted Expiry Contracted Expiry Expiring Contracted Expiry (msf) (msf) Rentals (INR psf) Rentals (INR psf) (msf) Rentals (INR psf) Mindspace Airoli East
Slide 46: Balance Sheet as on 31 Mar 22
Balance Sheet as on 31 Mar 22 Balance Sheet (INR Mn) 31 Dec 21 31 Mar 22 Notes Sources of Funds 1) Debt is prior to minority interest Total Equity 1,66,313 1,64,712 adjustment Sub-Total 1,66,313 1,64,712 2) Other Liabilities primarily include Trade Payables, Capital Creditors, Retention Liabilities
Slide 47: Debt Maturity Schedule as on 31 Mar 22
Debt Maturity Schedule as on 31 Mar 22 Principal Repayment Interest Wt. Avg. Description Fixed/ Total Undrawn Principal Rate Maturity FY28 & (INR Mn) Floating Facility Facility O/S FY23 FY24 FY25 FY26 FY27 Total (p.a.p.m.) (Years) Beyond At REIT Level MLD (Tranche 1) Fixed 5,000 - 5,000 6.6% 0.1 5,0
Slide 48: De-risked Portfolio with ~91.7% Completed Assets
De-risked Portfolio with ~91.7% Completed Assets Project wise Market Value breakup (1) Market value (INR million) Market value (%) Asset Completed Asset Under-construction/ Total Gross Under-construction/ Completed % of Total Value Value Future Development Asset Value Future development Mindspace Ai
Slide 49: 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 Perspective Current Hyderabad | 1.8 msf 3 currently Commerzone Madhapur identified assets Status: • 1.8 msf pre-leased (1) • Tenant has started fit-out work in the premises • OC received 8.
Slide 50: Research Houses Covering Mindspace REIT
13 Research Houses Covering Mindspace REIT Research House Analyst Email Id Ambit Capital Karan Khanna karan.khanna@ambit.co Bank of America Kunal Tayal kunal.tayal@bofa.com CITI Research Atul Tiwari atul.tiwari@citi.com Credit Suisse Lokesh Garg lokesh.garg@credit-suisse.com ICICI Securities Adhidev
Slide 51: 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 52: Thank You
Thank You Investor Relations Enquiries: Kedar Kulkarni (Finance & Investor Relations) Email id: ir@mindspacereit.com mindspacereit.com 52
Mindspace Business Parks REIT — Q4 FY2022 Earnings Presentation on 6ix