Property Share Investment REIT IPO: Listing preview and key details

Shares of Property Share Investment REIT IPO are set to debut on the BSE on Tuesday, marking an important milestone for small and medium REITs (SMREITs) as an asset class in India. The IPO, fully subscribed at 1.19 times on its final bidding day, underscores the growing interest in alternative real estate investments.

Focused on Bangalore's premium office space

The IPO proceeds will primarily finance the acquisition of Prestige Tech Platina, a LEED Gold-certified office property in Bangalore's Outer Ring Road (ORR). The property, spanning 246,935 sq. ft., is fully leased to a leading US-based tech firm under a nine-year lease. It features a weighted average lock-in period of 4.6 years and a 15 per cent rent escalation every three years, ensuring long-term rental income visibility.

Bangalore’s ORR is the city’s largest office market, housing 34 per cent of its total office stock. With tenants like Adobe, Amazon, Google, and Wells Fargo in the vicinity, the Prestige Tech Platina asset is strategically positioned to benefit from robust demand for quality office spaces in the region.

Financial projections and investor-friendly approach

The PropShare Platina scheme projects a nine per cent distribution yield for FY26, providing investors with an attractive income proposition. Additionally, the investment manager has waived annual management fees for FY25 and FY26, with nominal charges starting at 0.25 per cent from FY27 and 0.3 per cent from FY28 onwards.

Commitment from the investment manager

To demonstrate confidence in the project, Property Share will contribute five per cent of the scheme’s units or Rs 17.6 crore as its investment. The IPO is entirely a fresh issue of Platina units, with no offer-for-sale component, ensuring funds are utilized for growth and corporate purposes.

The listing of Property Share Investment REIT is a significant step for the SMREIT framework, offering a new avenue for investors seeking stable returns from high-quality commercial real estate assets. Investors can look forward to monitoring its performance in the secondary market starting today.