The trust, part of Indiabulls Real Estate Ltd., plans to sell 353 million units of Indiabulls Properties Investment Trust at between S$1 and S$1.10
Indiabulls Properties Investment Trust could raise up to $388.3 million (US$286million) selling units in a real estate investment trust (REIT) in Singapore, according to reports. The trust, part of Indiabulls Real Estate Ltd., plans to sell 353 million units of Indiabulls Properties Investment Trust at between S$1 and S$1.10.
This will be the first such sale by an Indian real estate company.
Billionaire Lakshmi Mittal, the world’s fourth-richest man, has reportedly agreed to buy 91mn units. Mittal was among the initial investors in Indiabulls Financial Services Ltd., which last year spun off Indiabulls Real Estate as a separate company.
The projected yield for the trust is 4.66-5.12% based on forecast income for the year ending March 2009. Presentations to institutional investors start today, with pricing scheduled for next week.
Deutsche Bank and Merrill Lynch are handling the deal, which will see Indiabulls inject into the trust two projects with a total of 3.4 million square feet of space, according to the prospectus filed with the Monetary Authority of Singapore earlier this month.
The Mumbai properties due to be ready by August, are designed for IT and financial firms and retail outlets, and has residential components. The two assets are estimated by Knight Frank to be worth US$3.2 billion.
The Indiabulls REIT would be the first major test of investors’ appetite for new listing since the market crash in November. The last two REITs to list in Singapore, Lippo-Mapletree Indonesia Retail Trust and Saizen REIT, tumbled on their debuts in November and are still trading well below their IPO price.
Credit ratings agency Moody’s only last week issued a negative outlook for Singapore’s REITs over the next 12-18 months, citing weak market sentiment and tighter liquidity that have impaired their access to capital markets.
The poor market conditions sparked by the US subprime crisis and the ensuing global credit crunch had forced Indiabulls Real Estate, and fellow Indian developers Unitech and DLF, to postpone their planned Singapore REIT IPOs in March.
2 Comments
Indian companies certainly seem to be going international, with Indiabulls leading the front by raising capital overseas.
Indiabulls Real Estate (IREL) decided to raise up to USD 600 million through various means in the domestic or international markets. It also planned to raise an equal amount from qualified institutional buyers.