Brookfield REIT IPO: Things To Know Before the Offer Opens

The fifth IPO of 2021, Brookfield India REIT IPO will open on Wednesday, February 3, for two days to raise up to Rs 3,800 crore from the market. It is the third REIT to open in the bourses, after Embassy Office Park REIT opened in 2019 and Mindspace, in 2020.

REITs are one of the attractive investment options, popular in many developed markets. In 2014, SEBI notified REIT’s regulation act, allowing the real estate investment trusts (REIT) to list in the bourses.

REITs invest in income-generating properties and distribute up to 90 percent of profit to investors through dividends. After listing with the exchange, REITs shares will trade like common securities in the bourses. Embassy REIT became the first REIT to list in the Indian bourses when its shares started trading in April 2019.

Brookfield REIT IPO Details

Investors willing to bid for the offer needs to take note of the following important factors.

• Brookfield India REIT is the only 100 percent institutionally managed real estate investment trust (REIT), backed by Canadian asset management firm Brookfield Asset Management
• Rs 3,8000 crore IPO will open for investors for bidding for two days between February 3 and 5, 2021
• Brookfield IPO price is set at Rs 274-275 range, and in this price range retail investors will have to bid for a minimum Rs 55,000 for 200 shares (minimum lot size)
• Investors can increase their bid size in multiples of 200 thereafter

Market experts and industry analysts expect Brookfield India REIT IPO to be successful with active participation from retail investors. Brookfield India REIT offer opens when the market is lifted by the Union budget, which exempted REIT dividend distribution from TDS for domestic investors and set tax rate at the lowest tier for FPI investors. Stable dividend earning remains a plus for retail investors with moderate risk-return expectations and a long-term investment plan.

Performance of the other REITs listed earlier helped investors earn a significant return on their investment, which might interest retail investors in investing Brookfield REIT’s offer. According to Shobhit Agarwal, MD & CEO of Anarock Capital, “The Brookfield REIT IPO launch definitely helps strengthen the overall India real estate investment trust space”.

The market feared a disruption in the income-yielding real estate space due to outbreak of the COVID-19 pandemic, with the rise in the work from home culture but the issuer said there is no data to confirm that office space demand will slowdown in the coming days. In fact, Brookfield India REIT clocked a profit of Rs 15.12 crores in 2020.

The Bottom Line

The Brookfield India REIT IPO is likely to get a boost from the Union Budget. Also, successful listing of the other two REITs will attract retail investors to Brookfield India REIT IPO.

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