Brookfield India Real Estate Trust · NSE:BIRET.RR
Brookfield India Real Estate Trust — Q4 FY2023 Earnings Presentation
46 slides from Brookfield India Real Estate Trust's earnings presentation, May 18, 2023
Slide 1: Q4 FY2023 Investor Update
Brookfield India Real Estate Trust Q 4 F Y 2 0 2 3 – I N V E S T O R U P D AT E M AY 1 8 , 2 0 2 3 CANDOR TECHSPACE N2, NOIDA
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: Brookfield India Real Estate Trust
Brookfield India Real Estate Trust India’s first and only 100% institutionally managed REIT, owning 18.7 MSF of class A office properties Delhi NCR (11.4 MSF) 18.7 MSF 14.3 MSF Gurugram 3.9 0.1 TOTAL AREA OPERATING AREA Noida 5.7 1.6 Total 9.7 1.7 89% Rs 65 PSF 69% EFFECTIVE ECONOMIC IN-PLACE RENT O
Slide 4: High Quality Properties in Gateway Cities
High Quality Properties in Gateway Cities 28% 26% One of the Largest Campus-style Offices in CBD Gurugram Largest Office Campus in Noida CANDOR TECHSPACE, SECTOR 21, GURUGRAM (G2) CANDOR TECHSPACE, SECTOR 135, NOIDA (N2) 4.0 MSF | 29 ACRES 4.5 MSF | 30 ACRES 15% 16% 15% Largest Corporate Facility lo
Slide 5: New Acquisitions | Downtown Powai and Candor Techspace G1
New Acquisitions | Downtown Powai and Candor Techspace G1 First Indian REIT to set up a long term partnership with the global institutional investor, securing c.Rs 33 Billion (c.US$ 400 Million) commitment towards the transactions Institutional Owner and Operator Long Term Investor One of the larges
Slide 6: New Acquisitions | Transaction Summary
New Acquisitions | Transaction Summary Brookfield India REIT (“BIRET”) and GIC(1) have signed binding agreements to acquire, in a 50-50 partnership, a 6.5 MSF operating portfolio for a total consideration of Rs 112,250 Million • Transaction #1: Acquisition of 50% interest in Downtown Powai, Mumbai (
Slide 7: New Acquisitions | Adding Scale and Diversity
New Acquisitions | Adding Scale and Diversity The transactions will further increase our scale while significantly diversifying our portfolio CURRENT PORTFOLIO PRO-FORMA PORTFOLIO (March 2023) (March 2023) Rs 283 B Rs 164 B Rs 9,608 M Rs 16,478 M Scale 20.6 MSF 14.3 MSF Operating Area Consol. Adj. N
Slide 8: FY2023 – Scorecard
FY2023 – Scorecard We have executed on our stated strategy and are poised for rapid growth in our business Metric Performance 1 Stable Distribution Rs 20.20 DPU In line with guidance 2 Leasing Success 2.1 MSF + 0.4 MSF of Expansion Options ~1.8x of historical average(1) 3 Development 0.2 MSF deliver
Slide 9: 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 63% 62% 52% 53% 50% 50% 43% 33% 33% COVID-19 3rd wave subsides 26% 21% 21% “Return-to-office” by tech 16% occupiers 9% 8% Jan-22 Feb-22 Mar-22 Apr-22 May-22 Jun-22
Slide 10: Leasing Success
Leasing Success Our properties crossed their pre-COVID gross leasing run rate driven by demand from new and existing occupiers GROSS LEASING (MSF)(1) FY2023 GROSS LEASING BREAKDOWN 18% 1.3 2.1 2.1 MSF 59% 23% 1.6 BT E-Serv 0.8 GE Oil & Gas New Tenants Existing Tenants Renewals Rs 95 PSF 13.1 Yrs. FY
Slide 11: Marquee Renewal Leading to a De-risked Income Profile
Marquee Renewal Leading to a De-risked Income Profile Significantly de-risked the expiry profile with a 10% decrease in the contracted rentals due for expiry till FY26 and achieved a renewal spread of ~35% RENEWAL IMPACT ON KEY OPERATING METRICS • In-Place Rent (in Rs PSF)(3): Improvement in in-plac
Slide 12: Significant Organic Growth Potential
Significant Organic Growth Potential We achieved a 15% growth in the contracted NOI run rate from Q4 FY2022 and have an embedded growth headroom of ~13% NOI GROWTH POTENTIAL (RS MILLIONS) +13% Contracted NOI Run Rate 11,404 - 11,554 Rs 10,144 300 - 370 +15% 960 - 1,040 366 936 9,778 8,842 Q4 FY2022
Slide 13: Q4 FY2023 | Business Highlights
Q4 FY2023 | Business Highlights We witnessed continued leasing demand with 1.2 MSF of gross leasing this quarter • Achieved 255,000 SF of new leasing 0.3 MSF 89% • Signed expansion options of 25,000 SF in K1 and 264,000 New Leasing New Effective Economic SF in Kensington Leasing Occupancy • Progress
Slide 14: Q4 FY2023 | Financial Highlights
Q4 FY2023 | Financial Highlights 15% increase in operating income versus Q4 FY2022 Growth vs Q4 FY2023 Q4 FY2022 • Rs 257 million (13.9%) YoY increase: Operating Lease o Rs 123 million (6.6%) due to addition of N2 in REIT Rentals (OLR) Rs 2,109 14% o Rs 134 million (7.2%) due to recent new leasing a
Slide 15: Q4 FY2023 | Distributions
Q4 FY2023 | Distributions Our distributions are in line with our guidance at Rs 5.00 per unit DISTRIBUTION PER UNIT COMPONENTS Rs 1,675 million DISTRIBUTION (Q4 FY2023) Rs 0.04 , 1% Rs 5.00 DISTRIBUTION PER UNIT (DPU) MAY 26, 2023 RECORD DATE Rs 2.66 , 53% Rs 2.30 , 46% (1) Interest on Shareholder L
Slide 16: Business & Financial Updates
Business & Financial Updates CANDOR TECHSPACE N1, NOIDA
Slide 17: Significantly Complete and Stable Portfolio
Significantly Complete and Stable Portfolio 94% of gross asset value is in operating properties, with an Effective Economic Occupancy of 89% and a long-dated WALE of 7.9 years Area (in MSF) Leased Area Metrics Dev. Area # Office Committed / WALE In-place Rent Asset Operating Total Potential in MSF T
Slide 18: Deep Rooted Tenant Relationships
Deep Rooted Tenant Relationships Technology-led, high credit quality tenant roster SECTOR DIVERSIFICATION OF TENANTS(1) TOP 10 TENANTS(1) % Gross % Area Tenant # Parks Contracted Leased Others, 10% Rentals Telecom, Technology, 46% Accenture 3 16% 14% 4% TCS 3 15% 14% Hardware, 4% Cognizant 3 10% 13%
Slide 19: New Leasing and Renewals
New Leasing and Renewals Achieved gross leasing of 1.2 MSF during the quarter while progressing on a 1.1 MSF leasing pipeline SELECT NEW LEASES / RENEWALS(1) Tenant / Industry Assets Area (SF) Industry Technology K1 62,000 Rs 107 PSF Artech HR Services N1 51,000 AVERAGE RENT ON GROSS LEASING(2) Tech
Slide 20: New Leasing and Renewals (Cont’d.)
New Leasing and Renewals (Cont’d.) 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 Area Expiring (MSF) Achieved/Expected Renewals (MSF) KEY HIGHLIGHTS Cumulative Expiry (% of Rentals
Slide 21: Property Income | Walkdown
Property Income | Walkdown MILLIONS Q4 FY2023 Q4 FY2022 KEY DRIVERS • Rs 257 million (13.9%) YoY increase: Income from Operating Lease o Rs 123 million (6.6%) due to addition of N2 in REIT Rs 2,109 Rs 1,852 Rentals (OLR) o Rs 134 million (7.2%) due to recent new leasing and contractual escalations •
Slide 22: Property Income | Walkdown
Property Income | Walkdown MILLIONS FY2023 FY2022 KEY DRIVERS • Rs 1,792 million (27.7%) YoY increase: Income from Operating Lease o Rs 1522 million (23.5%) due to addition of N2 in REIT Rs 8,268 Rs 6,476 Rentals (OLR) o Rs 270 million (4.2%) due to recent new leasing and contractual escalations • R
Slide 23: NDCF | Walkdown
NDCF | Walkdown Millions Q1 FY2023 Q2 FY2023 Q3 FY2023 Q4 FY2023 FY2023 Income from Operating Lease Rentals Rs 2,034 Rs 2,056 Rs 2,068 Rs 2,109 Rs 8,268 CAM / Other Revenue 876 980 931 915 3,702 Revenue from Operations Rs 2,910 Rs 3,036 Rs 2,999 Rs 3,024 Rs 11,970 CAM / Other Direct Expenses (742) (
Slide 24: NDCF | Walkdown
NDCF | Walkdown Millions Q1 FY2023 Q2 FY2023 Q3 FY2023 Q4 FY2023 FY2023 NDCF (SPV Level)(1) Rs 2,161 Rs 1,666 Rs 2,212 Rs 1,741 Rs 7,780 Interest on Shareholder Debt 860 825 816 813 3,314 Dividends 22 30 35 - 87 Repayment of Shareholder Debt 1,196 886 1,195 990 4,267 Investment of Shareholder Debt i
Slide 25: Summary Balance Sheet
Summary Balance Sheet Our business is well-capitalized, backed by a strong balance sheet MILLIONS MARCH 31, 2023 Liabilities and Equity Total Equity 83,337 Borrowings(1) 54,520 Security Deposits 5,009 Other Liabilities 3,540 Total 146,407 Assets Investment Property 134,057 Investment Property Under
Slide 26: ESG Updates
ESG Updates CANDOR TECHSPACE K1, KOLKATA
Slide 27: Renewable Energy
Renewable Energy Committed to accelerate renewable energy procurement and ensure transition to clean energy through value-accretive partnerships INTERIM SOLUTION LONG TERM SOLUTION • Nearing finalization of terms for the procurement of • Signed a Power Purchase Agreement (PPA)(1) to renewable energy
Slide 28: Key ESG Initiatives
Key ESG Initiatives Through continuous improvements, we ensure that our assets are efficient, resilient and future-fit, and support the needs of our tenants and communities BIODIVERSITY • 812 metric tonnes of CO2 has been sequestrated by the 812 MT ~20,000 trees at the REIT assets as per the latest
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 2 178 1 1 126 68 103 95 50 36 34 FY20 FY21 F
Slide 30: Information Supplement
Information Supplement CANDOR TECHSPACE G2, GURUGRAM
Slide 31: 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 29,000+ 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 32: 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 33: 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) FY2024E Kensington 123 12% Rs 140 G2 364 12% 86 N1 340 14% 41 N2 332 11% 55 K1 5 - 47 Total 1,164 10% Rs 70 FY2025E Kensington 41 4% Rs 152 G2 115 3% 112 N1
Slide 34: Q4 FY2023: Occupancy Bridge
Q4 FY2023: Occupancy Bridge ASSET DECEMBER 31, 2022 MARCH 31, 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 1,411 90% - (935) 882 1,563 1,357 87% G2 3,917 3,290 84% 21 - - 3,918
Slide 35: FY2023: Occupancy Bridge
FY2023: Occupancy Bridge ASSET MARCH 31, 2022 MARCH 31, 2023 OPERATING LEASED COMMITTED NEW GROSS OPERATING LEASED COMMITTED AREAS IN ‘000 SF RENEWALS AREA AREA OCCUPANCY LEASING EXPIRIES AREA AREA OCCUPANCY Kensington 1,558 1,409 90% 74 (1,068) 942 1,563 1,357 87% G2 3,877 3,232 83% 110 (184) 117 3
Slide 36: Q4 FY2023: New leasing & Renewals
Q4 FY2023: 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 - - 882 Rs 118 882 Rs 118(2) G2 21 97 - - 21 97 N1 131 70 - - 131 70 N2 41 58 2 - 43 58 K1 62 45 42 - 104 45 Total 255 Rs 63 926 Rs 118 1
Slide 37: FY2023: New leasing & Renewals
FY2023: 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 74 Rs 132 942 Rs 118 1,017 Rs 118(2) G2 110 83 117 90 227 87 N1 435 65 27 - 462 65 N2 193 69 93 58 285 65 K1 62 45 78 48 140 46 Total 873 Rs
Slide 38: Property Income | Consolidation Details (Q4 FY2023)
Property Income | Consolidation Details (Q4 FY2023) INCOME FROM REVENUE FROM MILLIONS OPERATING LEASE NET OPERATING INCOME (NOI)(1) OPERATIONS RENTALS (OLR) Q4 FY2023 Q4 FY2022 Q4 FY2023 Q4 FY2022 Q4 FY2023 % OLR Q4 FY2022 % OLR Kensington Rs 435 Rs 423 Rs 468 Rs 455 Rs 406 93% Rs 360 85% G2 618 534
Slide 39: Property Income | Consolidation Details (FY2023)
Property Income | Consolidation Details (FY2023) INCOME FROM REVENUE FROM MILLIONS OPERATING LEASE NET OPERATING INCOME (NOI)(1) OPERATIONS RENTALS (OLR) FY2023 FY2022 FY2023 FY2022 FY2023 % OLR FY2022 % OLR Kensington Rs 1,752 Rs 1,672 Rs 1,893 Rs 1,789 Rs 1,636 93% Rs 1,505 90% G2 2,386 2,294 3,49
Slide 40: Strong Capital Structure
Strong Capital Structure 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 8.20% AAA/Negative 32% 9 Yrs. AVERAGE INTEREST RATE(1) CREDIT RATING (CRISIL) NET DEBT TO AVERAGE MATURI
Slide 41: Capital Structure and Liquidity
Capital Structure and Liquidity Simple capital structure, low-cost asset level debt and significant debt headroom will continue to be our strengths HEADROOM IN LTV(2)(3) 49% Rs 52.7B NET DEBT(1) 32% 52% HEADROOM IN LTV Brookfield REIT Regulatory Cap SPV GROSS DEBT SUMMARY (MILLIONS)(2) ASSETS KENSIN
Slide 42: Ongoing Capex and Upgrades
Ongoing Capex and Upgrades Rs 2.6 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 43: 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 HSBC Bank Puneet Gulati PuneetGulati@hsbc.co.in ICICI Securities Adhidev C
Slide 44: Glossary (1/3)
Glossary (1/3) 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 45: Glossary (2/3)
Glossary (2/3) 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
Slide 46: Glossary (3/3)
Glossary (3/3) Consolidated GAV Consolidated GAV – GAV considering 100% stake in all SPV’s Consolidated Adjusted NOI Adjusted NOI considering 100% stake in all SPV’s Operating Area Operating Area considering 100% in all SPV’s 46
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