Nexus Select Trust To Launch India's First Retail REIT IPO On May 9

Blackstone-backed Nexus Select Trust REIT Ltd's initial public offer will open for subscription on Tuesday, May 9, and close on Thursday, May 11

The company has fixed a price band of Rs 95–100 per unit. The bidding for anchor investors will open on May 8, 2023.

The public issue comprises fresh issuance of units aggregating up to Rs 1,400 crore and an offer for sale of units by the selling unitholders aggregating up to Rs 1,800 crore. The company had earlier planned to raise around Rs 4,000 crore through the initial share sale.

The company aims to use the net proceeds towards partial or full repayment or prepayment and redemption of certain financial indebtedness of the asset special purpose vehicles and the investment entity; acquisition of stake and redemption of debt securities in certain asset SPVs; and general purposes, it said in its draft red herring prospectus.

The company is expected to be the first publicly listed consumption centre REIT, making it the first REIT retail asset offering in India. The current REITs—Embassy Office Parks REIT, Mindspace Business Parks REIT and Brookfield India Real Estate Trust—listed on stock exchanges are all backed by office assets.

REITs aim to attract investment in the real estate sector by monetising and unlocking the value of the rent-yielding assets.

Nexus Select Trust has a portfolio of 17 operational shopping malls in several cities, including Bengaluru, Chennai, Delhi, Hyderabad, Navi Mumbai and Pune, covering an area of 9.8 million square feet.

Its portfolio of assets comprises 17 Grade A urban consumption centres with a total leasable area of 9.2 million sq. ft., two hotel assets and three office assets as of Dec. 31, 2022. The REIT counts Delhi's prominent Select Citywalk mall in its portfolio.

The company's net loss narrowed to Rs 10.9 crore in fiscal 2022 in comparison with Rs 199 crore in fiscal 2021, while its revenue from operations rose to Rs 1,318 crore against Rs 906.9 crore. 

Wynford Investments Ltd., a portfolio company of Blackstone Funds, is the sponsor of Nexus Select Trust and Nexus Select Mall Management Pvt. is the manager.

Axis Capital, IIFL Securities, Morgan Stanley, and BofA Securities India are among the book-running lead managers to the IPO.

Shares of Nexus Select Trust are expected to debut on the BSE and the NSE on May 19.