Mindspace Business Parks REIT has completed the issuance of Commercial Papers of Rs100 crore for a maturity of 3 months at an interest rate of 7.20% per annum.
The Company’s Commercial Papers are rated CRISIL A1+, the highest rating by CRISIL. The funds will be utilised towards the working capital requirements of Mindspace REIT’s Asset SPVs. Loan to value of Mindspace REIT stood at 16.8% as on 30 September 2022, lowest amongst its peers.
According to the filing, in September this year, SEBI allowed Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs) to issue Commercial Papers. This welcome move offers an additional short term fund-raise avenue for REITs through shorter tenor instruments at a potentially lower interest cost and swifter timelines, the company said.
With this move, Mindspace REIT further broadens its debt profile. At the time of its IPO, in August 2020, 100% borrowings of Mindspace REIT were in the form of Asset SPV level bank borrowings. Over the past two odd years, Mindspace REIT has consciously diversified its lender portfolio and reduced its borrowing costs via multiple fixed-cost debenture issuances which are primarily subscribed by mutual funds, pension funds and insurers.
Speaking on this funding, Vinod Rohira, CEO, said, “After successfully exploring capital market fund raising through issuance of multiple debentures, we are glad to be the first Indian REIT to raise funds through Commercial Papers.
This is part of our larger strategy to diversify our lender base and optimise borrowing costs and maturity profile of our well-staggered debt book. Going forward, as part of our larger ESG commitment, we will also explore opportunities to raise funds via issuance of green bonds.”
At around 1:06 PM, Mindspace Business Parks REIT was trading at Rs340.30 per share higher by 0.45% on the BSE.
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