In another major boost to the growth of Small and Medium Real Estate Investment Trusts (SM REITs) in India’s evolving property investment landscape, Property Share Investment Trust (PSIT)—the country’s first SEBI-registered SM REIT—has filed draft documents for a INR 472 crore initial public offering (IPO) of its second SM REIT scheme, PropShare Titania.
PropShare Titania REIT IPO will be a 100% fresh issue, with OFS component. The net proceeds will be used mainly for the acquisition of a revenue-generating Grade A+ commercial office asset in Mumbai. This is Property Share’s second IPO after the successful INR 353 crore IPO of PropShare Platina, its first SM REIT, in November 2024.
Asset Highlights
At the heart of PropShare Titania is a 4,37,973 sq ft Grade A+ office asset located in G Corp Tech Park, Thane, a well-connected submarket in the Mumbai Metropolitan Region (MMR). The property, developed by the G Corp Group, is situated on Ghodbunder Road and is close to the upcoming Metro Line 4, making it a long-term hotspot.
What makes this asset stand out is its ESG credentials—the building holds multiple green and safety certifications including:
- LEED Platinum Certification
- WELL Health and Safety Rating
- BEE 5-Star Certification
The property is 100% leased to a diversified tenant base of Fortune 500 firms and MNCs including marquee names like Aditya Birla Capital and Concentrix, all of whom have had over nine years of presence in the building. The weighted average lease expiry (WALE) stands at 3.3 years, and lease agreements include a 5% annual rental escalation.
The scheme offers a projected distribution yield of 9.0% in FY26 and FY27, rising slightly to 9.1% in FY28, providing investors with predictable, inflation-hedged income.
PropShare Titania REIT IPO – Structure and Financial Design
The IPO will be conducted through a book-building process, compliant with SEBI’s REIT Regulations and Master Circular. The unit allocation will be:
- Up to 75% reserved for Institutional Investors
- At least 25% reserved for Non-Institutional Investors
The units will be listed on the Bombay Stock Exchange (BSE), with Kotak Mahindra Capital Company acting as the sole book-running lead manager (BRLM). KFin Technologies is the registrar, while Axis Trustee Services Ltd. serves as the trustee for the Trust.
Notably, the Investment Manager, PropShare Investment Manager, has waived off all management and property fees for FY26, with only a nominal 0.5% management fee from FY27—a rare move in the REIT space and one that enhances post-expense yields for early investors.
The Investment Manager has also contributed 5% of the units to the scheme, aligning its interest with that of the unit holders.
Regulatory Framework and Evolution of SM REITs
PropShare Titania is among the first SM REIT schemes to enter the public markets under a new regulatory category introduced by SEBI in March 2024. SM REITs are designed specifically for mid-sized, income-generating commercial real estate assets valued between INR 50 crore to 500 crore.
Key Regulatory Features:
- Minimum investment: INR 10 lakh (1 unit)
- No exposure to land or under-construction projects
- Mandatory 95% distribution of net distributable cash flow (NDCF)
- Listing required on recognized stock exchanges
- Maximum leverage of 49% at the scheme level
This new category bridges a critical gap in India’s real estate financing ecosystem by enabling fractional ownership of institutional-grade assets while maintaining transparency and regulatory oversight.
India’s Real Estate Market
India’s commercial office market is experiencing a post-COVID resurgence. According to the JLL Office Market Report (Q4 2024):
- Net absorption hit 49.95 million sq ft in 2024—a historic peak
- Gross leasing reached an all-time high of 77.2 million sq ft
- Grade A office stock in top seven cities has surged to ~854 million sq ft, up from ~60 million sq ft in 2004
India is now one of the most active commercial office leasing markets globally, driven by:
- Strong GDP growth
- A robust, cost-effective talent pool
- The continued expansion of global capability centers (GCCs)
With 40% of this office stock (~341 million sq ft) considered SM REIT-worthy, the investment potential stands at INR 3.8 lakh crore (~USD 44 billion). Mumbai alone contributes over INR 1.4 lakh crore to this opportunity set.
Strategic Importance and Broader Vision
The launch of PropShare Titania comes at a time when investors are increasingly seeking alternative asset classes that offer stable returns, capital preservation, and low correlation with equity markets.
Co-founder Kunal Moktan emphasized this in his remarks:
“This marks another milestone in our mission to create a transparent, liquid, and institutional-quality real estate investment platform for individual investors. In a volatile equity market environment, rent-yielding commercial assets like SM REITs are emerging as a compelling alternative.”
Co-founder Hashim Khan added:
“PropShare Titania gives investors cost-effective access to top-tier commercial real estate assets. With SM REITs, we are transforming how India invests in real estate.”
Governance, Risk, and Financial Discipline
PSIT operates under a robust governance framework. Its board has approved a borrowing policy in line with SEBI guidelines. As per current disclosures:
- The Trust has no financial indebtedness
- The Investment Manager has borrowed INR 10 crore from its parent company to fund the earnest deposit, pending asset acquisition
Risk is overseen by a dedicated Risk Management Committee, and compliance is anchored by top-tier advisors including Cyril Amarchand Mangaldas and Trilegal.
Conclusion
PropShare Titania is not just a real estate offering—it represents a broader paradigm shift. With its strong yield profile, institutional-grade asset, ESG certifications, and regulatory oversight, it offers a unique blend of stability and income potential in an increasingly uncertain macroeconomic environment.
It also serves as a proof of concept for the evolving SM REIT ecosystem in India. If successfully subscribed, it could pave the way for dozens of similar offerings in the coming years, democratizing access to commercial real estate and potentially expanding the market to over INR 43,000 crore AUM by 2030.
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