Real estate players raising capital through NCD

Real estate players are now resorting to the issue of non-convertible debentures (NCD) to raise the capital.

Recently, Intime Properties, a part of the K Raheja Corp group raised Rs 340 crore through the issue of non-convertible debentures with a fixed rate of 9.95 per cent.

According to a statement issued by the real estate firm, the security is a commercial mortgage-backed security (CMBS). The issue was being used to refinance bank debt. It has been rated AAA by India Ratings, according to a statement by the firm.

“INTIME owns and operates 3 commercial office buildings in Mindspace IT Park, Hyderabad, with a total leasable area of 1.71 mn sq f. The property is currently 99% occupied by over 35 clients,” it said.

It may be noted that Real estate major DLF had previously come out with a CMBS issue in May. The NCDs are set to mature in nine years, with options to redeem in the fourth and the sixth year, respectively.

The Raheja group holds 89 per cent stake in Intime, with the remainder held by the Andhra Pradesh Industrial Infrastructure Corporation Ltd, according to the company statement. IDFC Ltd and Credit Suisse Securities (India) Private Limited were the arrangers of the issue.