REIT Listings Deferred Amidst Market Volatility
Unitech and Indiabulls Real Estate Ltd (IBREL) have postponed their plans to list their respective real estate investment trusts (REITs) on the Singapore Stock Exchange (SGX) due to the ongoing liquidity crunch affecting global markets. Both companies had previously secured approval from the SGX for the initial public offerings (IPOs). This decision comes on the heels of a similar move by DLF, India's largest real estate firm, regarding its own property trust.
Companies Explore Alternative Funding Routes
In light of the challenging market conditions, these companies are now actively pursuing private placements with international financial institutions to support their expansion plans. DLF, which initially aimed to raise approximately Rs 8,000 crore through its property trust listing, will now seek around Rs 2,000 crore from domestic financial institutions.
Indiabulls and Unitech Adjust IPO Strategies
Indiabulls' IPO, originally slated for mid-March, was projected to generate $1.2 billion (Rs 4,800 crore), with Indiabulls selling 14% of its property trust, Indiabulls Properties Investment Trust (IPIT). IPIT was intended to acquire One Indiabulls Centre and Elphinstone Mills, both developed and owned by Indiabulls in central Mumbai and valued at a combined Rs 8,080 crore. Unitech, too, had ambitions to raise Rs 2,800 crore ($700 million) through the Unitech Office Trust, which was set to acquire the company's IT/ITeS properties located in Noida, Gurgaon, and Kolkata. Unitech had initially targeted raising Rs 8,000 crore from the IPO but later scaled down its expectations to Rs 2,800 crore due to ongoing global market volatility.
Unitech Postpones QIP Issue
Adding to the shifts in financial strategy, Unitech has also decided to put a $1.5 billion (Rs 6,000 crore) qualified institutional placement (QIP) issue, planned for the first quarter of 2008, on hold.