DLF to file for REIT listing by fiscal-end

Real estate developer DLF plans to file for a Real Estate Investment Trust (REIT) listing in 2015-16, most likely in the fourth quarter, the company said in the latest analyst presentation on its website.

“The company intends to form 2 REIT platforms to strategically monetise almost 30 million square feet of commercial assets – both office and retail—thereby recycling capital for future growth, increasing ROE (return on equity) and reducing debt,” DLF said. “It targets the first filing within fiscal year 2016, most likely in the fourth quarter, subject to all approvals.”

Both strategic and financial investors have approached DLF in this regard, the investor presentation for the fourth quarter of 2014-15 said.

Muted demand

The company said demand continued to be muted in most micro-markets and this is expected to last at least another 12 months.

The realty major expects “better outlook in the commercial office segment as growth in domestic services sector, especially e-commerce-based businesses, is providing the momentum and rental rates are expected to remain firm or move northwards”. The revival of consumer demand and expectation of experiential spaces will give further fillip to well located, well managed ‘new generational’ retail malls, the company said.

DLF’s net debt rose by Rs. 628 crore to Rs. 20,965 crore as on March 31 against Rs. 20,336 crore at the end of the third quarter of financial year 2014-15.

The current attributable net debt to the development arm (DevCo) is Rs. 6,965 crore and to the rental business (RentCo) is Rs. 14,000 crore.

Quarterly results

“The company is exploring all opportunities to further optimise the debt profile which includes issuance of commercial mortgage-backed securities or debentures,” it said.

DLF on Wednesday reported a fall of 21.81 per cent in net profit at Rs. 172 crore for the fourth quarter of fiscal 2014-15 against Rs. 220 crore for the same period in the previous fiscal. The consolidated revenue for the quarter stood at Rs. 2,101 crore, down 17 per cent from Rs. 2,522 crore for the corresponding quarter a yea ago.

The company reported 16.4 per cent lower net profit at Rs. 540 crore for the full financial year against Rs.646 crore in 2013-14. The consolidated revenue dropped 16.56 per cent to Rs. 8,168 crore for 2014-15 against Rs. 9,790 crore for the previous fiscal. Business Line