Mindspace REIT IPO

A Real Estate Investment Trust (REIT) is in the business of generating income through owning and leasing out real estate. Mindspace Business Parks REIT holds and leases out real estate spaces in 4 cities - Mumbai, Chennai, Hyderabad, and Pune.

Check out the REIT portfolio as on March 31st, 2020 as per the offer documents:

Mindspace is looking to raise about Rs 4500 crore in the IPO out of which Rs 3500 crores are shares being sold by the promoters and Rs 1000 crores will be in form of a fresh issue.

Issue details

Price band ₹ 274 -275
Lot size 200 units
Issue Period July 27th to 29th
Listing date August 7th

How do I apply for the Mindspace REIT IPO?

The UPI IPO method for applying is not yet available for REITs. You can log into your bank’s netbanking portal and use your BO ID to apply using netbanking ASBA. The application amount will be blocked in your bank account and will be deducted only if you receive allotment of the units which will be added to your demat account.

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Hi, do you think once the shares get listed on NSE/BSE, what would the trading price be? if IPO is at 275/share , can we expect it to be listed at a premium?

This largely depends upon the subscription interest and how the overall market is doing. If you’re applying for listing gains, you should wait till the last day of the issue to make your decision.

Hi @mohitmehra Hi, I want to apply for Mindspace ipo,however i am unable to find allotment rules for this ipo.
Can you tell me if i should apply from all my family members a/c to increase allotment chances or maximum from 1 a/c. applications would be treated as retail or hni?

Please help urgently

Hi , I am not able to apply for Mindspace IPO . Issue with Zerodha app and webpage ?

You can only apply for the REIT through your bank’s netbanking portal if supported. The UPI IPO method is not available for REITs.

No support from zerodha on my query? :roll_eyes:

Hi Tejas,

There are two application categories in the REIT issue: Institutional & Non-Institutional. The applications made by both Retail & HNI investors fall in the Non-Institutional category. Since the allotment will be pro-rata, you’re better off applying in a single application.

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@mohitmehra what are your personal views on the future of REIT businesses?

Because of Coronavirus working professionals especially IT and ITes folks are now working from home for the last 4 months. The irony is the same managers earlier would have rejected your ‘work from home’ request in the past stating - ghar se kaam nahi hota.

Govt has already extended the work from home norms till 31st Dec, 2020. By then it would already create a new habit and a part of the company work culture. I learned from my college friends working in IT companies in Bangalore that their company is reducing the office sizes and seating capacity, instead of 3-4 floors, shrinking to 1-2 floors. Not to forget some of the leading companies have already declared permanent ‘work from anywhere’ policy.

Real estate prices, even housing rental prices are seeing a correction in cities like Mumbai where about 70% of the population live on rent.

Moreover, Blackstone is offloading its stakes with the REIT. Is it wise to invest only to pay someone’s debt in such unprecedented times when the future of work culture is uncertain? I don’t think ‘work from home’ will replace office-goers completely. But certainly, the numbers would reduce. So will the income from the rental of commercial space in the future.

I would like to invite others who have better knowledge than me to take this discussion ahead.

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Even-though it seems that work from home is new norm , companies cannot risk their IP. Maybe this doesn’t apply for startups and mid tier software companies but if you take a look at mindspace customers so many of them are already established customers and they wont just move their office out. If you take a look at their top clients like accenture, jp morgan , amazon they value their intellectual property more than they value rent. Also getting a new office is not an easy task. And if they want to cut costs they cant just dump all their assets in a warehouse. They need maintenance and proper surveillance. I think almost all the clients of mindspace will stick to their offices since the risk outweighs their costs. May be i am wrong but this is my opinion and i welcome everyones suggestions.

This seems to be the rational story to tell. In order to correctly value the company, you will need to quantify the financial effect of this story. A few things which you may have to consider to perform the valuation include - the present agreements the company has with its tenants, how much value will the sort of companies that rent spaces from Mindspace assign to having a physical presence in the future, what alternative revenue streams could the REIT tap if they have free space, etc.

Real estate prices are generally a function of both the consumption and investment cycles. Consumption has been strong Pre-COVID. A lot of people, reasonably, see that changing since more companies could permanently adapt WFH for their some of employees, if not all. At the same time, some employees may prefer to get back to working from the office space. This is difficult to speculate on, even for companies, which is why they might be hesitant to let go of occupied office spaces unless ofcourse they are facing financial constraints and need to cut down on the cost.

There are two fundamental ways to make an investment or a trading decision -

  1. Observe the relevant story, quantify the value and then compare it with the currently available price
  2. Follow price action

If one is unable to complete the first one thoroughly, following price-action might be the rational thing to do. For IPOs, one can use the subscription data to make their decision the price-action way.

Hello @mohitmehra,

I have booked Mindsapce REIT IPO through SBI Netbanking but i dont have demant account in SBI account However i had demat account with different broker that is Upstox i have mentioned same DPID in application.

My query is once the share allotted to me, will it be credited to my Upstox demat account ? will i be able to see same stocks info in upstox porfolio on stocks listing day?

Yes, your alloted shares will be credited to your Upstox demat account and you should be able to see them in Holdings on Upstox upon listing.

@ShubhS9 Thanks for your response. let me wait until the allotment date.

In the US market, there are REIT shares and ETFs. They (requires) pay high dividends. How about India? Is this the first REIT or there any before?

Also, is it a good time to buy shares of real estate when I.T companies are offering work from home. The shops depending upon the IT workers sees loss. Malls are empty, movie theaters are closed…?

There is another one Embassy Office Park REIT, which was listed last year on Exchanges.

Do they pay monthly or yearly dividends? In Google, I can see it has mentioned 6.74% Div yield. But I can’t see any history in moneycontrol - Embassy Office Parks REIT | Dividends > Construction - Real Estate > Dividends declared by Embassy Office Parks REIT - BSE: 542602, NSE: EMBASSY

Also, what type of real estate do they own?

Quarterly, like any other company.

You can check dividend history here.

You can learn more about Embassy REIT on their website.

Hey… while trying to get mindspace reit IPO I am going for HDFC ASBA option.
But I am only able to See HNI status of investor and not retail one. Does anyone else facing similar issue?

@Mani_Kan_Dan
see the dividend , Hai i love REIT for portfolio diversification ,

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