Brookfield REIT IPO Subscribed 7.97 Times On Final Day

Brookfield India Real Estate Trust's initial public offering oversubscribed on the final day, with investors betting on India's growing number of REIT listings as the nation tweaked rules to make the vehicle more attractive.

The Rs 3,800-crore issue was subscribed 7.97 times as of 5 p.m. on Feb. 5. While the category reserved for non-institutional investors subscribed 11.78 times, institutional investors bid for 4.8 times the shares on offer, according to Axis Capital.

The oversubscription of Brookfield REIT—backed by Canadian asset manager Brookfield Asset Management Inc.—demonstrates the confidence among investors in the overall economic growth of the country, said Sharad Agrawal, executive director-capital markets at Knight Frank India. “Brookfield is the third REIT in India which has witnessed a great reception, owing to several factors including brand value, quality of assets in the portfolio and expectation of rental yields.”

This, he said, also proves that investors have great faith in growth of commercial asset classes on a long-term basis, despite apprehensions due to the new culture of work from home. “Knight Frank expects the office market to witness robust growth in the near future as the macroeconomic conditions in India stabilises and as the majority of the employee base starts working from the office workspace.”

Before the IPO, Brookfield REIT raised Rs 1,709 crore from 39 anchor investors. Nearly 75% of the anchor book was apportioned to domestic institutional investors, it said, with HDFC Mutual Fund and Kotak Mutual Fund together garnering more than 25% share.

The company, according to its offer document, will use the net proceeds from the issue towards scheduled re-payments and general purposes.

Brookfield REIT's initial portfolio comprises four large campus-format office parks in Mumbai, Gurugram, Noida and Kolkata, totaling 14 million sqft—10.3 million sqft of completed area, 0.1 million sqft of under construction area and 3.7 msf of future development potential.

Previously, Embassy Office Parks REIT went public in 2019 and Mindspace Business Parks REIT listed in August last year.