Mindspace REIT buys Hyderabad office asset for Rs 512 cr at 11% discount

Business Standard

24-07-2025

The real estate investment trust (REIT) of Mindspace Business Parks has acquired Mack Soft Tech (MSTPL) in Hyderabad for Rs 512 crore. MSTPL is a holding company of Q-City, a 0.81 million square foot (msf) commercial asset in the city.
Mindspace REIT bought the property at an 11.6 per cent discount to its independently assessed value. 'Securing the property at an 11.6 per cent discount to an independent valuation and an attractive 9.9 per cent cap rate demonstrates our disciplined capital deployment and commitment to long-term value for unitholders,' said Ramesh Nair, chief executive officer and managing director of the REIT.
This is Mindspace REIT's first third-party asset addition, outside its portfolio parks. The transaction was done through Horizonview Properties, a special purpose vehicle. The acquired asset will be rebranded as The Square, 110 Financial District.
The acquired asset has a leasable area of 0.81 msf, located in the Financial District of Hyderabad. Around 65 per cent of the asset is occupied. 'The asset stands to gain from Mindspace REIT's tenant network and asset enhancement expertise, driving quicker lease-up of the balance space,' said the REIT. Occupancy levels across Mindspace's assets stood at around 93 per cent as of Q4 FY25.
With the acquisition, Mindspace REIT's Hyderabad presence is now over 16 msf in aggregate. Nair said, 'The Hyderabad market is India's hottest GCC hub, now home to more than 350 global capability centres and the nation's fastest-growing tech and BFSI talent base. With institutional-quality supply extremely tight and virtually no major investment-grade assets on the market, the timing is ideal. As Madhapur and HITEC City approach capacity, global occupiers are migrating westward in the city, and our acquisition positions us to capture this demand.'
In Hyderabad, Madhapur rentals have risen to Rs 90 to Rs 100 per square foot due to limited supply and higher demand. Rental arbitrage with Madhapur positions Financial District to benefit from demand spillover, Mindspace said.
Post-acquisition, Mindspace REIT's portfolio size will grow from 37.1 msf to 37.9 msf, while its gross asset value will increase from Rs 36,647 crore as of FY25 to Rs 37,143 crore. The loan-to-value ratio will increase from 24.3 as of FY25 to 25.1 per cent. The transaction will also increase the net asset value by Rs 1.8 per unit.