MINDSPACE — earnings call
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Prepared remarks
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Transcript of 1st Annual meeting of Mindspace Business Parks REIT – June 29, 2021
TRANSCRIPT OF 1ST ANNUAL MEETING OF UNITHOLDERS OF
MINDSPACE BUSINESS PARKS REIT
Transcript of 1st Annual meeting of Mindspace Business Parks REIT – June 29, 2021
Mr. Rohit Bhase
Compliance Officer: Good afternoon ladies and gentlemen.
It is 02:00 pm of 29 June 2021, and it
is time to commence the meeting.
First and foremost, I wish good health to
each one of you and to your kith and kin.
I welcome you all to the first annual
meeting of Mindspace Business Parks REIT, which is being held through
video conferencing and audio-visual means.
Before we start the proceedings of the meeting, I would like to give you an
overview of the process to participate in this meeting through video
conferencing, and other audio-visual means.
The facility to join this meeting
through video conferencing and other audio-visual means has been made
available for unitholders on a first-come-first-serve basis.
The unitholders who
have joined this meeting are kept on mute mode by the host to avoid any
disturbance arising from background noise and to ensure smooth and
seamless conduct of the meeting.
Before we proceed further, I would like to introduce the members of the
Governing Board of K Raheja Corp Investment Managers LLP, acting as
Manager to Mindspace Business Parks REIT who have joined this meeting –
Deepak Ghaisas, Independent member and Chairperson of the
Governing Board, the Stakeholder's Relationship Committee and the
Investment Committee and who shall also preside over this meeting as the
Bobby Parikh, Independent Member and Chairperson of the Audit
Committee and the Nomination and Remuneration Committee,
Manisha Girotra, Independent Member, Mr.
Alan Miyasaki, Non-
Independent Member.
Ravi Raheja, Non-Independent Member and
Neel Raheja, Non-Independent Member.
With us we also have Mr.
Vinod Rohira, Chief Executive Officer and Ms.
Chheda, Chief Financial Officer of the Manager to Mindspace Business Parks
Further, the representatives of Axis Trustee Services Limited, Trustee
to Mindspace Business Parks REIT, Deloitte Haskins and Sells LLP, Statutory
Auditors of Mindspace Business Parks REIT and Makarand Joshi and Co.,
Scrutinizers for this meeting are also present by video conferencing.
meeting will commence with the Chairperson addressing the unitholders of
Mindspace Business Parks REIT.
It will be followed by a presentation from
Vinod Rohira, Chief Executive Officer, on the operational and financial
performance of Mindspace Business Parks REIT for the financial year 2020-
During this meeting, if a unitholder faces any technical issue, he may
contact the helpline number mentioned in the Notice which is 040 7961 5205.
I repeat the helpline number for resolving any technical issue is 040 7961
Transcript of 1st Annual meeting of Mindspace Business Parks REIT – June 29, 2021
In case the unitholder is dialing from outside India, please add 91 as a prefix.
Mindspace Business Parks REIT has engaged Kfin Technologies Private
Limited for hosting this meeting through electronic means and for providing
remote e-voting and e-voting facilities at this meeting.
Makarand M Joshi
and Co., practicing company secretaries, is appointed as the Scrutinizer by
the Manager to scrutinize the remote e-voting and e-voting during the Meeting
to ensure that the same is carried out in a fair and transparent manner.
Manager had fixed 28th May 2021 as the cut-off date for dispatch of Notice
and Annual Report to the unitholders and accordingly, the Notice for this
meeting and the Annual Report for the financial year 2020-21, along with the
login and password for joining this meeting were sent on 4th June 2021, by
electronic mode to those unitholders whose email ids were registered with the
depositories and by courier to those unitholders whose email ids were not
registered with the depositories.
Notice and the Annual Report are also
available on the website of Mindspace Business Parks REIT and the BSE
limited and National Stock Exchange of India Limited.
The Manager had fixed 22nd June 2021 as the cut-off date for identifying the
unitholders who shall be eligible to vote through remote e-voting facility and
for participation and voting at this meeting.
Accordingly, web links of Notice
and Annual Report along with login and password for those joining this
meeting were sent to those unitholders who did not hold units as on 28th May
2021, but became unitholders of Mindspace Business Parks REIT on 22nd
The same was dispatched by electronic mode to those unitholders
whose email ids were registered with depositories and by courier to those
unitholders whose email ids were not registered with the depositories.
Mindspace Business Parks REIT provided a facility for remote e-voting to its
unitholders in respect of the business to be transacted at this meeting by
electronic means, from 9:00 am on 25th June 2021 to 5:00 pm on 28th June
Since this meeting is being held through video conferencing or other audio-
visual means and as the resolutions mentioned in the Notice convening this
meeting have already been put to vote through remote e-voting, there will not
be any proposing or seconding of the resolutions.
Similarly, the facility for
appointment of proxy and voting by show of hands by unitholders will also not
available for this meeting.
Now I request the Chairperson to grant instructions
for activating e-voting for unitholders who are present at this meeting and who
have not yet cast their votes using remote e-voting facility.
Mr. Deepak Ghaisas
Chairperson : Sure, right.
I approve and authorize the commencement of the e-voting during
the meeting, which shall remain open till 15 minutes after the conclusion of
proceedings of this meeting.
Transcript of 1st Annual meeting of Mindspace Business Parks REIT – June 29, 2021
Mr. Rohit Bhase
Compliance Officer: Thank you, Sir.
I request the Chairperson to take over and conduct the
Mr. Deepak Ghaisas
Chairperson : Thank you.
A very warm Good afternoon.
Welcome to the first annual meeting
of unitholders of Mindspace Business Parks REIT.
I would like to begin by wishing good health to each of you and your families.
In line with the new normal Mindspace Business Parks REIT has arranged to
conduct this annual meeting through video conference.
And we confirm that
the same is in compliance with the regulations circular issued by the Security
and Exchange Board of India for real estate investment trusts.
Since the notice, annual report and the financial statements for the financial
year 31st March 2021 are already circulated to the unitholders.
shall be taken as read.
It has been little less than a year since Mindspace REIT got listed and I take
pride in saying that we delivered a resilient performance in financial year 2021
and remain confident about the long-term prospects of the business.
successful listing on the bourses in August 2020, amidst the pandemic, with
the marquee global investors, as our unitholders reflect the trust and
confidence that unitholders have placed in us.
We raised INR 45 billion
through the issuance which saw an overwhelming subscription of 13 times.
While Covid 19 pandemic has disrupted the business environment globally,
as also domestically.
I am confident that India will witness, newer
opportunities and optimize each of them till the situation returns to normalcy.
Given the unique proposition that India offers for quality office space
complemented the technology talent pool and the country is set to benefit from
the long-term trends.
Our sponsors are part of the K Raheja Corp group, which
has over four decades of legacy in building large scale, real estate portfolios
in the country, and a record of creating a strong micro markets via building
mixed-use of ecosystems backed by the experienced Management Team of
Mindspace REIT is to navigate these challenges and grow.
Our prudent approach to capital deployment coupled with our ability to
generate free cash gives us a comfortable headroom for the growth and
enables us to create a long-term sustainable value for the unitholders,
governance, and sustainability continues to remain our focus areas in
delivering long-term performance.
Transcript of 1st Annual meeting of Mindspace Business Parks REIT – June 29, 2021
We believe the medium to long-term potential of Grade A office space remains
Having witnessed strong performance and robust hiring by Indian
technology companies who are key demand drivers of office space.
Mindspace REIT, we are committed to provide an integrated business
ecosystem that enables tenants to leverage a skilled talent pool and cost
arbitrage to achieve their business goals.
Our tenants are some of the large corporates and we remain committed to
delivering the long-term and sustainable value to them.
As on March 31, 2021, our portfolio housed 82.9% foreign multinational
companies with 35% of our gross contracted rentals coming from fortune 500
A strong relationship with our tenants cultivated over the years
helped us to lease three and a half million square feet to 44 tenants during
financial year 2021 amidst the pandemic times.
With regard to our financial performance for the financial year 2021, our
revenue from operations and net operating income on a performance basis
stood at 16.3 billion and 13.7 billion respectively, representing a growth of
5.1% and 12.1% on year on year basis.
In the financial year 2021, we
optimized our operating costs leading to increased net operating income
We also achieved a substantial reduction of over 200 bps on our cost
of borrowing from 9.2% in March 2020 to 7.1% in March 21.
keep our distribution in line with our projections, despite the leasing
For half-year of 2021 we distributed rupees 5.7 billion that is
9.59% per unit, which translates into the annualized distribution year of 7% on
the issue price.
We have strategically moved towards creating a mix of fixed
costs and variable costs debt in the portfolio with 30% total outstanding debt
as on 31st March 2021, being fixed costs.
We shall pursue opportunities to
finance some of our existing debt to further optimise our overall cost, cost of
that our net debt of two market values stands at 14% as on March 31 2021,
and low gearing equips us with the significant financial flexibility to pursue
value, accretive growth opportunities.
ESG or environmental, social and governance, integration, are necessary
steps for the future.
At Mindspace REIT we have invested in building
environmental, social, and governance which is ESG centric ecosystem,
integrating it into the business assets, operations and culture.
sustainable development and operations we adopt the latest technology and
systems and implement resource efficiency across our parks.
a detailed sustainability assessment program to improve construction
The stuy covers climate effects on indoor air quality, wind, study
sun path analysis, natural daylight analysis, and more.
Also, optimize the
lifecycle of materials through sustainable materials management system
where materials are reused more productively over the lifecycle.
Transcript of 1st Annual meeting of Mindspace Business Parks REIT – June 29, 2021
that we are developing in the portfolio are LEED certified green buildings,
which have a keen focus on energy and water conservation, indoor air quality
and waste management.
In 2020, Mindspace REIT became the first real
estate entity in India to pledge its commitment to the climate group, EV 100,
transitioning to 100% electricity, electric mobility by 2030.
provide 950 electric vehicles charging stations at our business parks and see
that number move north.
I'm also happy to share that just last week, we took
another leap, becoming India's first real estate entity to join climate groups re
100, committing to transitioning to 100% renewable electricity use by 2050 in
a phased manner.
Our initiative aligned with those of climate group and our
continuous efforts to build a sustainable ecosystem for our tenants.
these commitments also enable us to encourage a large tenant base to
consider the sustainability levers for their own businesses.
We have a current
installed capacity of approximately 1.8 megawatts of rooftop solar and are
working towards transitioning to source 100 GWh power generated by
renewable energy sources annually.
At Mindspace REIT we are driven by the three R's - reduce, recycle and reuse.
In our operations, with regards to waste management 80 to 100% of the
construction waste generated is reused, reducing burden on the city dumping
Wet waste is composted and converted into manure and is used for
landscaping within the business parks.
Horticulture waste is used as mulching
material to reduce water consumption and increase soil fertility.
compostable waste is sent to the State Pollution Control Board (SPCB)
approved recyclers.
To conserve water lower wastage is ensured to reduce sewage volumes and
water bills and reduced dependency on municipal water.
More recent projects
have seen interventions through IOT and sensors to monitor quality of the
recycled and treated water, rainwater harvesting, water recycling reuse of
treated water for gardening and low flow fixtures are only some of the
To provide our tenants with better air quality we regularly
measure it to the achieved significant health and financial benefits.
30% more fresh air than mandated by ASHRAE 62.1 standard across our
green buildings.
At Mindspace REIT we also rejuvenate landmarks that are
iconic and make for public recreation spaces.
For instance, we undertook the
complete makeover of Hyderabad’s iconic Durgam Cheruvu Lake in
partnership with the local government and continue to ensure its upkeep.
lake has been converted from an algae ridden one to a beautiful attraction
replete with jogging tracks, kids play corners, yoga corners, cycling paths, and
At Mindspace REIT, we relentlessly strive to maximize our positive social
impact by integrating and internalizing community services into business
We undertake initiatives in the space of education and
Transcript of 1st Annual meeting of Mindspace Business Parks REIT – June 29, 2021
empowerment with our NGO partners, Deeds Public Charitable Trust and
Room to Read India, for effective implementation of our CSR pursuits.
also working closely with local government and NGOs through multiple
interventions to fight COVID-19.
We have assisted with provisions for oxygen
concentrators, medical equipment, and consumables for weaker sections of
the communities.
Mindspace REIT also recognizes key stakeholders – Our
last mile labourers.
During the pandemic, we ensured availability of quality
food, adequate medical aid, and sanitized living spaces across our sites.
would also like to highlight here that we invest in their overall welfare.
zero-tolerance towards having children at the worksites and at the same time,
we understand that they need to be kept safe and secure while their parents
To enable this, we have partnered with NGO Mumbai mobile
creches, which provides day care facilities along with the quality education,
mid-day meals, and health care for the children.
Accountability, fairness, and transparency with all the stakeholders are the
guiding principles of the governance.
At Mindspace Business Parks REIT we
aim at creating sustainable and long-term value for stakeholders.
governing board oversees the implementation of strategies, conducts periodic
reviews vis a vis a set objective, and suggests course correction, in the case
The ESG efforts amalgamates to create a more equitable and
sustainable business model, an ecosystem that is good for the business and
the generations to come.
Our objective is to maximize unitholders returns in
the form of regular distribution and unit price appreciation by enhancing our
portfolio value.
Our able, dynamic leadership team has the capability to adapt
to this ever-changing environment and to deliver sustainable business
I express my deepest gratitude to the governing board members
for their contribution and governance insights, our unitholders for their trust,
and the confidence.
Our employees for their consistent delivery, the
challenging backdrop of our customers, vendors, and each of stakeholder for
Last but not the least, I thank the labour force at our projects,
who have played an instrumental role in helping us craft the magnanimous
I seek your continued support and look forward to continuing this
journey and in creating long-term sustainable value for our stakeholders.
Vinod Rohira to make a short presentation on the performance
of the Mindspace Business Parks REIT for financial year 2020-21.
Chief Financial Officer: Thank you, Chairperson Sir.
Good afternoon, everyone.
Our Chairperson has
covered most of the points that I'm going to take up right now.
But I still want
to just give you a brief snapshot of how we saw the year.
It was right in the
middle of the pandemic when we listed and we got an overwhelming
Our issue was in and we were like Chairperson sir mentioned more
Transcript of 1st Annual meeting of Mindspace Business Parks REIT – June 29, 2021
than 13 times oversubscribed.
Thanks to the overwhelming support of our
Thank you very much for that.
Our portfolio as you all may be aware,
the 30. 2 million square feet spread across four micro markets Mumbai, Pune,
Hyderabad and Chennai with an in-place rent of about 55.9 rupees per square
foot and a market valuation of 246 billion with a 92.3% market value worth of
completed assets.
Our debt today is just 14% of our NAV, which gives us a
lot to grow in the near future.
Then is a quick snapshot highlight of amongst
the significantly challenging years in recent history for commercial real estate.
We managed to lease 3.5 million square feet of real estate and added close
to 44 new tenants in this year during the pandemic.
We were able to distribute
5687 million with a 7% distribution yield as promised.
While Chairperson sir
has touched upon the sustainability aspect, a lot of initiatives taking place to
ensure we continue to take a leadership position in that direction.
snapshot overview of the leasing that we just mentioned to you about 2.14
millions square feet was released, and 1.33 million square feet was added as
a new area with new tenants with a vacant area leasing of seven lakh square
feet, and the leases signed across 44 tenants.
So here is a very healthy
combination of our existing tenants growing with us and new tenants
participating in joining our group of valued tenants in our portfolio.
continued to deliver a sustainable financial performance coupled with very low
leverage across debt being 38 billion, we are just 14% of our NAV.
weighted average cost of debt has come down from 9.2 to 7.1.
9.59 per unit as a distribution of 7% yield to our investors on the issue price
for the period from October to March 2021.
With this, I end my presentation
and I hand it over back to you Chairperson sir.
Chairperson : All unitholders may now note that the Mindspace REIT had extended a facility
to its unitholders who would like to express their views to ask questions during
the meeting by registering themselves for the same.
Further unitholders were also granted a facility to pose their queries on annual
report or notice before the date of the meeting.
The said facilities were
available from 9:00 am on June 25 to 5:00 pm on June 27 2021.
such registrations or queries are received from the unitholders, we may
continue with the further proceedings of the meeting.
However, in case any
questions are posed by the unitholders through ‘ask the question’ facility, then
the management would respond to such questions or queries after the
meeting is over, over the email to the respective unitholders.
In case any further clarifications are required, the unitholders can reach out to
the compliance officer or investors relation cell of Mindspace Business Parks
I request Rohit to appraise the unit holders with resolutions in the notice
of this meeting.
Transcript of 1st Annual meeting of Mindspace Business Parks REIT – June 29, 2021
Mr. Rohit Bhase
Compliance Officer: Thank you, sir.
The report of statutory auditors for the financial year ended
31st March, 2021 does not contain any qualification, observation or comment
which may have an adverse effect on the functioning of Mindspace Business
Accordingly, the said report is not required to be read out before
Now I would like to apprise the unitholders present at this
meeting about the resolutions proposed in the notice for the unitholder's
approval by a simple majority -
Resolution at item number 1: To consider, approve and adopt the Audited
Standalone Financial Statements and Audited Consolidated Financial
Statements of Mindspace Business Parks REIT as that and for the financial
year ended March 31, 2021, together with the report of statutory auditors their
own for the financial year ended March 2021 and the report on the
performance of Mindspace Business Parks REIT.
Resolution at item number 2: To consider, approve and adopt the valuation
report issued by Mr.
Shubendhu the value for the valuation of a portfolio of
Mindspace Business Parks REIT as at March 31 2021.
Resolution at item number 3: To consider, approve and ratify appointment of
the value of for the financial year 2020- 21 to 2022- 23.
Resolution at item number 4: To consider and ratify the appointment of
Statutory auditors for the financial year 2021-22.
And resolution at item number 5: To consider and approve remuneration
payable to the members of the Governing Board.
The Proceedings of the meeting along with the consolidated results of the
remote e-voting and e-voting during the meeting will be announced within 48
hours from the conclusion of the meeting and the said results along with the
scrutinizer's report will be intimated to the stock exchanges as per the
applicable law and would also be placed on the website of Mindspace
Business Parks REIT and K-fin Technologies Private Limited.
transcript of this meeting shall also be made available on the website of
Mindspace Business Parks REIT.
Now, I offer a vote of thanks to the Chair on
behalf of all the unitholders and members of the governing board present at
Thank you Deepak sir.
Mr. Deepak Ghaisas
Chairperson : Sure.
The voting facility will remain open for next 15 minutes to enable
unitholders to cast their vote, who have not yet cast their vote on the
resolutions and who are otherwise not barred from doing so.
authorize the Compliance Officer to accept, acknowledge and counter sign
Transcript of 1st Annual meeting of Mindspace Business Parks REIT – June 29, 2021
the Scrutinizers report in connection with the Meeting and declare the results
of the voting in accordance with the requirements prescribed under the
applicable laws.
So I take this opportunity to thank all the unitholders for taking
their time out to join this meeting.
I thank all board members present on the
board, and other invitees for attending the meeting.
With this along with other
members of the Governing Board and key manager personnel would like to
conclude and leave this meeting.
Please take care of yourself.
vaccinated, stay home and stay safe.
Thank you very much.