Bagmane Prime Office REIT IPO Sees Substantial Demand on Third Day, Subscriptions Exceed 3.48 Times

Bagmane Prime Office REIT IPO Concludes Today Amid Strong Subscription

The initial public offer of Blackstone-backed Bagmane Prime Office REIT, which opened for subscription on Tuesday, 5 May, is set to conclude today, Thursday, 7 May. The Bagmane Prime Office REIT IPO price band has been fixed at ₹95-100 per unit.

Prior to the public offering, the REIT based in Bengaluru, which develops and manages Grade A office properties, has successfully secured approximately ₹1,150 crore from initial investors. The REIT's asset portfolio consists of six high-quality Grade A business parks totalling around 20.3 million square feet, located in prominent office micro-markets in Bengaluru, including the Outer Ring Road (ORR) and the Secondary Business District (SBD City).

Real Estate Investment Trusts (REITs) serve as investment vehicles that own and manage income-generating real estate, enabling investors to earn rental income without directly owning the properties. With this development, Bagmane Prime Office REIT becomes part of India's expanding listed REIT sector, which currently comprises Knowledge Realty Trust, Mindspace Business Parks REIT, Brookfield India Real Estate Trust, Embassy Office Parks REIT, and Nexus Select Trust.

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Of the listed REITs, Nexus Select Trust stands out as the sole retail-focused REIT supported by shopping mall properties, while the remaining REITs primarily manage office real estate portfolios.

The estimated listing price was ₹104 per share, 4% above the IPO price of ₹100, considering the upper end of the Bagmane Prime Office REIT share price band and the current grey-market premium. Based on the analysis of the past 10 sessions of grey market activity, the current IPO GMP is on an upward trend, suggesting a strong listing is anticipated.

The company has received bids for 51,49,20,900 units against 14,79,21,000 shares on offer at 14:45 IST, according to NSE data. The Bagmane Prime Office REIT IPO subscription status was 3.48x on day 3, so far. The other investors' portion was subscribed at 4.40x, and the institutional investors' portion was booked at 2.71x.

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The initial public offering (IPO) includes a new issuance of units totalling up to ₹2,390 crore, along with an offer for sale (OFS) of units valued at up to ₹1,015 crore by the selling unit holder. The funds raised will be utilised to purchase Luxor, located at Bagmane Capital Tech Park, which covers an area of one million square feet, as well as finance part of the acquisition of a 93 per cent stake in Bagmane Rio, the owner of the 1.1 million square feet Bagmane Rio Business Park.

The leading managers for this issue are JM Financial, Kotak Mahindra Capital Company, Axis Capital, IIFL Capital Services, SBI Capital Markets, 360 ONE WAM, and HDFC Bank.