Mindspace Business Parks REIT has successfully completed strategic acquisitions worth ₹1,817.24 crores through a preferential unit allotment on January 9, 2026. The REIT allotted 3,91,59,342 units at ₹464.64 per unit to acquire 100% equity shareholding in Sundew Real Estate Private Limited and Pramaan Properties Private Limited.

Acquisition Details and Unit Allotment

The Allotment Committee of the Board of Directors approved the preferential allotment following satisfaction of various conditions precedent under the respective share purchase agreements. The allotment was structured in two tranches based on the acquired entities:

The allotment was conducted in accordance with SEBI (Real Estate Investment Trusts) Regulations, 2014 and Chapter 10 of the REIT Master Circular dated July 11, 2025, governing preferential issues by listed REITs.

Portfolio Expansion Through Strategic Assets

The acquisitions significantly expand Mindspace REIT's commercial real estate portfolio across key metropolitan markets. Sundew Real Estate brings The Square Avenue 98 (BKC Annex), a commercial building located at Village Kole Kalyan, South Salsette Taluka, Mumbai Suburban District. This property currently offers approximately 0.15 million square feet of leasable area with potential to enhance capacity to 0.22 million square feet.

Pramaan Properties contributes two strategic assets to the portfolio:

• Ascent-Worli: Located in Worli, Mumbai, this office building provides approximately 0.45 million square feet of leasable area along with 36 residential units proposed for rental operations
• Raheja Woods Office Building: Situated in Kalyani Nagar, Pune, offering approximately 0.11 million square feet of leasable area including an amenity building

Transaction Structure and Regulatory Compliance

The acquisitions were executed following comprehensive due diligence and receipt of all required corporate authorizations, waivers, permits, and approvals. The transaction structure involved Mindspace REIT acting through its trustee, with K Raheja Corp Investment Managers Private Limited serving as the Manager.

The preferential allotment follows earlier board meetings and unitholder approvals conducted through postal ballot, as referenced in the REIT's communications dated November 28, 2025, and December 30, 2025.

Market Position and Asset Quality

The acquired properties are strategically located in prime commercial districts, enhancing Mindspace REIT's presence in Mumbai's Bandra Kurla Complex vicinity, Worli business district, and Pune's established Kalyani Nagar area. The total leasable area addition of approximately 0.93 million square feet (current capacity) represents substantial portfolio growth, with potential expansion to over 1.0 million square feet upon optimization of The Square Avenue 98.

The transaction demonstrates Mindspace REIT's continued focus on acquiring quality commercial real estate assets in key metropolitan markets, funded through strategic unit issuances to existing stakeholders of the acquired entities.

India's office real estate investment trusts are entering what Morgan Stanley calls a new phase of low-risk, compounding returns, driven by strong leasing momentum, easing interest rates, and sustained demand from global capability centres. FY25 marked a clear inflection point for listed office REITs, with distribution per unit growth of around 10.00% year-on-year — the first such acceleration since their listing.

Market Fundamentals Drive REIT Performance

Morgan Stanley expects distribution per unit to compound at roughly 10.00% annually over the next three years, supported by higher occupancies, new leasable area additions, and the full transmission of rate cuts. India's office market fundamentals remain resilient, with leasing volumes growing at a 33.00% compound annual growth rate over the past two years, while rents have expanded at a 7.00% CAGR.

The structural strength comes from robust GCC demand. According to NASSCOM, the number of GCCs in India is expected to rise from about 1,760 in FY25 to nearly 2,400 by FY30, with market size expanding at a similar pace. This growth trajectory should maintain strong demand for quality office assets.

Interest Rate Environment Provides Additional Support

Lower interest rates add another significant tailwind for REITs. The Reserve Bank of India has cut rates by a cumulative 125 basis points since January 2025, which Morgan Stanley expects to flow through to REIT distributions by FY27. This monetary easing creates a more favorable environment for real estate investment trusts.

Morgan Stanley's Investment Recommendations

Against this positive backdrop, Morgan Stanley has made strategic rating changes across the REIT sector:

Mindspace Emerges as Top Pick

Mindspace Business Parks REIT emerged as the top pick due to several compelling factors:

• Low leverage profile providing financial flexibility
• Strong sponsor-led acquisition pipeline
• Data centre exposure offering growth diversification
• High mark-to-market rental upside potential

Embassy Benefits from Strategic Positioning

Embassy Office Parks REIT benefits from dominant exposure to Bengaluru and GCC tenants, which contributed nearly two-thirds of its recent gross rentals. This positioning aligns well with the structural growth in global capability centres.

Brookfield Faces Different Growth Dynamics

Brookfield's growth strategy is more acquisition-led, which could potentially raise leverage levels while offering a less tax-efficient distribution profile compared to its peers.

Challenges Remain Despite Positive Outlook

Despite improving fundamentals, Morgan Stanley identified constrained institutional participation as a lingering challenge for the REIT sector. Regulatory changes, including Securities and Exchange Board of India reclassifying REITs as equities, should help over time, but near-term institutional inflows remain limited. This regulatory evolution represents a key factor for long-term sector development and broader market participation.