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Janhavi Manohar

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Partner in the Capital Markets practice at the Bangalore office of Cyril Amarchand Mangaldas. Janhavi has advised clients across a wide range of sectors on public offerings of securities, including IPOs, India’s first REIT, qualified institutions placements and debt issuances. She has also advised clients on private equity investments. She can be reached at janhavi.manohar@cyrilshroff.com

REIT

The Securities and Exchange Board of India (SEBI) issued a circular in April this year (Circular), reducing timelines for REIT listings from 12 working days to six working days from the date of public issue closure. While this is a welcome move from the perspective of public investors and is yet another step towards ensuring parity between REIT and listco regimes, this could prove challenging for REITs and their advisors, given the intricacies of the REIT regulatory framework.Continue Reading Reduction in REIT Listing Timelines – A Sprint to the Finish Line?

REITs in India - A prescription for regulatory inoculations and booster shots

In our previous piece , we had gazed into our crystal ball for predictions on the future of REITs in India, specifically in light of the ongoing Covid-19 pandemic and its aftermath. However, putting the largely untameable forces of macroeconomic factors, sectoral outlooks and market perceptions aside, there are some regulatory changes which, if introduced by the relevant regulators in a timely manner, could provide the real estate sector and specifically, REITs in India, with the necessary shot in the arm to thrive in the times to come. Set out below is a short wish-list.
Continue Reading REITs in India: A prescription for regulatory inoculations and booster shots

Corporate house-keeping during a crisis

Secretarial compliances, periodic reporting and disclosure requirements, programmed into the DNA of listed companies, often proceed seamlessly following protocols defined by the legal regime and industry best practices. However, with social distancing advisories changing the way in which corporate India goes to work, management and secretarial teams will need to re-assess established protocols and approach day to day internal housekeeping matters a little differently in the coming months.
Continue Reading Corporate house-keeping during a crisis

REITs in India - Some predictions for the next 24 months

  • Tenant-landlord dynamics are likely to change. In the short term, tenants may seek dispensation, moratoriums or discounts to their payment obligations, on the grounds of force majeure or otherwise. In the medium term, there will be an expectation from developers to increase spend on social wellness and hygiene infrastructure.
  • The forced experiment of remote working may become a norm for certain businesses and have an impact on the flexi-working policies of all businesses, one way or another. As a result, tenants may reassess their space utilisation requirements, and developers, their ability to offer IT infrastructure, which can enable seamless connectivity for their tenants.

Continue Reading REITs in India: Some predictions for the next 24 months (and beyond)

 Post-Listing Frameworks for REITs

REIT IT RIGHT

An eight-part series covering the commercial and legal considerations of REIT listings in India. The previous parts can be accessed here – Part 1, Part 2, Part 3, Part 4 .

Investor protection forms the bedrock of securities laws frameworks around the world with securities regulators putting in place meticulous and stringent governance, reporting as well as compliance frameworks for listed entities. The Indian securities regulator  has also prescribed a labyrinthine set of laws for post-listing reporting and corporate governance compliances by listed companies.

In stark contrast, however, the present regulatory framework for Real Estate Investment Trusts (REITs) in India offers limited guidance on post-listing compliances by listed REITs, mandating few compliances (mainly in relation to financial reporting, annual and half-yearly disclosures and investor grievances) and remaining silent on the applicability of a vast number of other obligations (including in relation to prevention of insider trading, takeovers and acquisitions, open offers etc.) which are typically applicable to listed companies.
Continue Reading Part V – Post-Listing Frameworks for REITs – A Giant Jigsaw with many a Missing Piece

REIT IPO Exit

*An eight-part series covering the commercial and legal considerations of REIT listings in India. Click here to read Part 2.

Institutional investors have demonstrated a steadfast interest in Indian real estate in recent years. Private equity investments in the real estate sector peaked at $2.5 billion in the first quarter of 2019 – the highest since 2008.[1] With the lion’s share of investments being cornered by commercial office spaces, retail and hospitality sectors, the introduction of the Real Estate Investment Trust (REIT) framework in India comes at an opportune time, providing investors with an additional avenue for potential exits.

However, as the dust settles over India’s first REIT listing, it is now apparent that a REIT IPO is vastly different and distinct from an IPO by a company in many respects. Given the inherent intricacies and nuances of the REIT framework, investors seeking to exit via a REIT listing will need to re-calibrate, re-assess, and re-think their investment strategies, holding structures, investment documentation as well as exit horizons to expediently navigate the new regime.
Continue Reading Part III – Exit Stage: Preparing for a REIT IPO Exit

 

Part I - REIT Management Frameworks

*This is the first part of an eight-part series covering the commercial and legal considerations of REIT listings in India

Setting up a Real Estate Investment Trust (REIT) involves a number of synchronised actions by all parties to the REIT including the Sponsors, Sponsor Group, Trustee, Manager, Special Purpose Vehicles (SPVs) and their respective stakeholders.

Apart from settling the trust, one of the principal obligations of the Sponsors includes contribution of the initial portfolio of assets to the REIT (immediately preceding the closure of the public issue). While the assets may be transferred through various means, the favoured (and tax efficient) option is for the Sponsor to swap its shares in the SPVs housing the portfolio assets in exchange for REIT Units. Thus, the REIT becomes the shareholder and owner of the assets, the Sponsors become Unitholders of the REIT and the REIT Manager (which is typically controlled/ managed by the Sponsors), is entrusted with the responsibility of managing the affairs of the newly acquired assets, through an investment management framework.
Continue Reading Part I – REIT Management Frameworks – An Exercise in Navigating Split Allegiances