Blackstone Offloads Entire Stake In Embassy REIT For Rs 7,100 Crore: Report

Last year, Blackstone sold its shares in Embassy REIT and raised nearly $325 million from the deal, in turn, lowering its stake to nearly 24 per cent from the earlier share of 32 per cent. 

Embassy Office Parks REIT is India’s maiden Real Estate Investment Trust (REIT) sponsored by Blackstone and Embassy group, based out of Bengaluru. 

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Investment company Blackstone sold its entire stake of 23.5 per cent in the Embassy Office Parks REIT on Wednesday for about Rs 7,100 crore, media agencies reported citing anonymous sources. Notably, Embassy Office Parks REIT is India’s maiden Real Estate Investment Trust (REIT) sponsored by Blackstone and Embassy group, based out of Bengaluru. 

Citing anonymous sources, PTI reported that Blackstone offloaded its entire stake at nearly Rs 316 per share via open market transactions. This values the deal at nearly Rs 7,100 crore, however, the deal was done at a discounted selling price.

The shares of the company dipped 1 per cent to settle at Rs 332.11 apiece as trading closed on Wednesday. Some of the existing unitholders, like ADIA, took part in the block deals, the report said quoting the sources. The new investors included SBI Mutual Fund, it added. 

Embassy REIT was listed in the stock market in 2019 after it collected nearly Rs 5,000 crore through the public issue. The Embassy Group holds about 8 per cent stake in the Embassy Office Parks REIT. Embassy Group CMD, Jitu Virwani, noted, “We welcome the expansion of the REIT's public float register to include more high-quality investors. We believe that this transaction underscores the success of REITs in India and demonstrates how the world's leading investors view the criticality of well-run, high-quality REITs such as Embassy REIT in their portfolios.” 

The company executive further stated that the REIT’s investor base includes domestic mutual funds, insurers, and foreign institutional investors, like sovereign wealth funds. “The business is in great shape, as demonstrated by its recent strong performance, in which the REIT delivered one of its highest leasing achievements to date in the first half of this fiscal,” Virwani added. 

He noted that the diverse distribution of unitholders adds depth and liquidity to the entity’s units, helps increase efficiency in price discovery, and strengthens governance. “Embassy REIT is an independent listed entity run by a professional management team. The REIT is strategic to Embassy Group, and we remain committed to its growth and development,” he said.

Embassy REIT CEO, Aravind Maiya, noted, “The entity's public shareholding continues to go up and has increased from 30 per cent at IPO to 92 per cent now. We paved the way for REITs in India and the increased investor participation is heartening.”

Notably, Blackstone has sold its share in many tranches. Last year, it sold its shares in Embassy Office Parks REIT and raised nearly $325 million from the deal. This deal reduced the investment firm’s stake in the entity to nearly 24 per cent from the earlier share of 32 per cent. 

Embassy REIT boosts of a portfolio of 45.3 million square feet of nine infrastructure-like office parks and four city centre office buildings in Bengaluru, Mumbai, Pune, and the National Capital Region (NCR). It also includes 35.3 million square feet of finished operating area. Blackstone launched two REITs in India, namely, Embassy REIT and Mindspace REIT. The investment firm has already exited the latter.