India's biggest REIT IPO: Sattva Group, a trust backed by Blackstone, submits documents for a ₹6,200 cr REIT offering

By Bricksnwall | 2025-03-07

Knowledge Realty Trust, funded by Blackstone-Sattva, seeks for an IPO of ₹6,200 crore. In terms of size, this will be the biggest REIT in India and the second largest in Asia. 

On March 6, Sattva Developers and Knowledge Realty Trust, which is sponsored by Blackstone, submitted draft offer documents to market regulator SEBI in order to conduct their first REIT public offering and raise about ₹6,200 crore.

According to its DRHP, KRT intends to fund about ₹6,200 crore through a REIT-IPO.

According to the company, KRT is the most geographically varied office REIT in India, with a total portfolio of 48 million square feet (37 million square feet completed) spread across 30 Grade A office assets in six major cities.

In an effort to raise money for its 30 prime office assets spread across major cities, Knowledge Realty Trust (KRT) has submitted the Draft Red Herring Prospectus (DRHP) to SEBI in order to launch an Initial Public Offering (IPO) and list the REIT on stock exchanges. The total area of these assets is 48.1 m², which includes 37.1 m² of completed space, 2.8 m³ of under construction space, and 8.2 m³ of future development space, the company stated.

90 percent of the entire portfolio is leased to well-known companies, with MNCs accounting for 76 percent and GCCs (Global Capability Centers) for 45 percent, the report stated.

According to the document, the portfolio is dispersed over Hyderabad, Mumbai, Bengaluru, Chennai, Gift City Ahmedabad, and Gurugram.

According to its expected gross asset value of ₹60,000 crore and net operating income (NOI), KRT will be the biggest REIT in India, the statement stated..

REITs: What are they?

Investment entities known as REITs own, run, and oversee a portfolio of properties that generate income in order to provide consistent returns. Commercial assets that can produce consistent rental revenue are included in REITable properties. They function similarly to shares or mutual funds.

REITs must be traded like securities and listed on exchanges by law. Just like they can purchase shares or mutual funds, small investors can purchase REIT units from the primary and secondary markets.

India's REITs

Brookfield India Real Estate Trust, Embassy Office Parks REIT, Mindspace Business Parks REIT, and Nexus Select Trust are the four REITs that are currently listed in India. Together, the four REITs now in existence own more than 126 million square feet of Grade A office and retail space nationwide. Together, these REITs have disbursed more than ₹21,000 crore to unitholders since their founding.

The other three REITs, excluding Nexus Select Trust, are supported by office assets that generate rent. Nexus has a sizable portfolio of retail properties.

With three listed REITs and one for Ventive Hospitality, this will be Blackstone India Real Estate's sixth public offering.

In seven Indian cities, Sattva Developers has built 74 million square feet of commercial, residential, co-living, co-working, hospitality, and data center space thus far. An additional 75 million square feet area is in planning and implementation.

Expert Opinion

Large developers and investors are actively participating in India's REIT industry, which is growing quickly. By encouraging more individual investors to participate, the new REIT's listing will further reduce liquidity in the real estate market. According to Shrinivas Rao, FRICS, CEO of Vestian, REITs are a vital financial instrument for diversifying investor portfolios and generating steady income.

Nearly 60% of the office stock in the top seven cities in India is REIT-worthy, per Vestian's most recent report, "REITs: Reshaping India's Commercial Space." Due to the existence of branded Grade-A office buildings in these desirable locations, the majority of REIT-worthy assets are concentrated in the commercial centers of the top seven cities.

India is expected to see an increasing number of REIT listings with expansion into new real estate categories as the legal environment develops. The Indian REIT sector is anticipated to be stimulated by a favorable regulatory environment, improved returns on investment, and a fast growing office market, he stated.

Source: Hindustan Times