MYRE Capital, a tech-enabled platform that provides easy access, transparency, and liquidity to a curated selection of rent-yielding commercial real estate assets, launches its next big investment opportunity in Times Square, Mumbai.
The fractional ownership real estate platform offers an exclusive opportunity to invest in 17,816 sq. ft. of A-grade office space strategically situated in an established residential and commercial hub in Andheri East, Mumbai. The proposed area spans the entire 10th floor of the newly constructed Tower-C in Times Square.
The entire tower is leased to Smartworks, the market leader in Managed Workspace Solutions. Smartworks has subleased the premises to Indian Financial Technology and Allied Services (IFTAS), a Reserve Bank of India (RBI) subsidiary.
In the post-pandemic world, the ‘Hub & Spoke’ model has become increasingly popular. The attractive lease terms, favourable micro market fundamentals, and the strategic asset location make it a compelling investment opportunity.
The investment opportunity offers an average yield of 10.5% and a target internal rate of return (IRR) of 13.6%. The lease tenure provided by the tenant is 5+5+5 years, totaling 15 years, which is an excellent opportunity during the Covid times. The minimum investment size for this opportunity remains at Rs. 25 lakhs per person.
Mumbai, the largest metropolitan city in India, is one of the preferred locations for MNC firms, Indian banks, financial institutions, and life sciences firms. The traction in the office area and the growth of the office market have been phenomenal in the last few years. In fact, Mumbai performed relatively better than most other cities when it came to Covid-related distress.
The property is located in one of the city’s largest commercial micro-markets. It is situated in micro-market 5, Western Suburb 1, which has seen the highest tenant absorption of 0.312 MSF owning to the affordable rentals and excellent public connectivity. With a stellar tenancy profile, high absorption, and attractive location, the micro-market presents strong fundamentals.
World Class Infrastructure
The property is strategically situated near the Mumbai Airport, with excellent connectivity to the upcoming coastal road and the Western Expressway. The micro-market is also closely connected to 5 Metro lines which are almost within walking distance.
This Gold-rated LEED-certified property is spread across 6.5 acres of land, making it a unique opportunity. Suchland parcels are very rarely available in Mumbai now, given the population density and extent of urbanization. With minimal vacancy, superior connectivity, and on-premises amenities, the park has seen an uptick in new leases and renewals from tenants.
The office space consists of 4 towers with a total leasable area of 886,000 Sq.ft. and a vacancy of 8%, which is very impressive for Mumbai, especially after two lockdowns. The reason for the low vacancy rate is the low rentals and the strategic location.
The floorplates have been designed with four subdivisible units, providing flexibility for enhanced liquidity and releasing. The columns in the floorplate are situated at the intersection of the sub-units providing better useability of the space. In the entire development, there are a few floor plates that have access to a dedicated balcony.
A Golden Opportunity to Invest
The benefits of managed leasing include long-term tenant stability, dual protection from managed leasing partner and sub-tenant, vacancy risk mitigation, superior asset upkeep, high stickiness, and rental assurance as the managed leasing partner is responsible for the rental payment irrespective of subtenant vacancy.
Smartworks is India’s most prominent and profitable provider of agile workspaces, serving 500+ enterprise customers. Some enterprise customers include Microsoft, Amazon web services, TATA, Samsung, Larsen & Toubro, Bacardi, Hitachi, DHL, Daikin, Swiggy, Toppr, OLX, Digit Insurance, just to name a few. Most of Smartworks customers are A+ grade tenants and large enterprises. Today, many large enterprises prefer the new managed leasing Smartworks solution, making it a very stable sub-tenant profile.
The sub-tenant, Indian Financial Technology & Allied Services (IFTAS), is a fully-owned subsidiary of the Reserve Bank of India that designs, deploys, and provides the essential IT-related services required by the Reserve Bank of India, banks, and financial institutions. Their flagship payment products and services are a critical part of India’s financial infrastructure, connecting banking and financial institutions across the country reliably and securely. IFTAS provides vital infrastructure services to RBI, banks, cooperative societies, and other financial institutions.
Smartworks leased 600 seats to Ocwen Financial Services, one of the largest sub-leases during the lockdown. They also leased 4.5 lakh SF office space in Mumbai and Hyderabad, again during Covid.
Final Thoughts
Fractional ownership is now the smart way to own assets in modern times. It is slowly emerging in the country, giving modern investors a chance to participate in investment opportunities and avenues at a fraction of the cost. Fractional ownership is a rewarding opportunity to generate wealth, passive income, and portfolio. Since this is a relatively new concept to Indians, partnering with tech-enabled platforms can help make the process simple and hassle-free.
