Brookfield India REIT to Acquire Ecoworld Office Campus in Bengaluru for Rs 13,125 Crore

Brookfield India Real Estate Trust (Brookfield India REIT) has entered into binding agreements to purchase Ecoworld, a significant Grade A office campus spanning 7.7 million square feet on Bengaluru's Outer Ring Road. The total acquisition cost is Rs 13,125 crore.

The transaction will be financed through a combination of Rs 3,500 crore from new debt issuance, Rs 1,000 crore from cash proceeds of a recent preferential issue, and Rs 2,500 crore from a new equity issuance.

This acquisition marks Brookfield India REIT's entry into one of India's prime office markets and will boost its portfolio size by over 30%, positioning it as a nationwide platform. The campus is currently leased to major global capability centers and corporations, including Honeywell, Morgan Stanley, State Street, Standard Chartered, Shell, KPMG, Deloitte, and Cadence. The asset was originally developed by RMZ Corp and partially acquired by Brookfield Asset Management from RMZ Corp in 2020.

The deal is structured at a 6.5% discount to the Gross Asset Value (GAV) and is projected to result in a 1.7% increase in Net Asset Value (NAV) and a 3% increase in distribution per unit (DPU) on a pro-forma basis. Post-acquisition, Brookfield India REIT's operating area will grow by 31% and its GAV by 34%. The REIT expects the share of global capability centers in its tenancy to rise to 45%.

Impact: This acquisition is highly significant for Brookfield India REIT, enhancing its scale, market presence, and future growth prospects. It demonstrates strong investor confidence in India's commercial real estate sector, particularly in prime office markets like Bengaluru. The increased GAV and DPU accretion are positive indicators for unitholders. Rating: 8/10

Difficult Terms: * Grade A office campus: High-quality, modern office buildings in prime locations, typically featuring advanced infrastructure, amenities, and professional management. * Global Capability Centers (GCCs): Operations set up by multinational companies in other countries to perform specialized business functions, often including IT, R&D, and customer support. * Gross Asset Value (GAV): The total market value of all assets owned by a company before deducting liabilities. * Net Asset Value (NAV): The value of a company's assets minus its liabilities. For a REIT, it represents the underlying value of its properties per unit. * Distribution Per Unit (DPU): The amount of income distributed to each unit holder of a REIT over a specific period. * Operating lease rentals: Payments made by tenants for the use of property or equipment under an operating lease agreement. * Net Operating Income (NOI): The profit generated from a property after deducting operating expenses but before accounting for financing costs, depreciation, and income taxes.