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Unveiling Multiple Opportunities in Fractional Commercial Real Estate

18 Apr 2024 - Tushar
Reading time about 3 minutes

Commercial Real Estate (CRE) refers to properties used for business purposes, like offices, retail spaces, warehouses, and hotels. Owning CRE can be a lucrative investment, offering rental income and the potential for capital appreciation. However, CRE has historically been out of reach for many investors due to the high entry cost.

Fractional Real Estate Opportunities

Fractional Real Estate

Fractional ownership allows investors to purchase a portion of a high-value property, sharing ownership benefits and risks proportionally. This democratizes CRE investment, making it accessible to a wider range of individuals. Recently SEBI has issued regulations in the form of SM REIT for fractional real estate giving much-needed regulatory structure.

Listing here some recently launched opportunities in this space. Mind that these opportunities may not have yet come under SM REIT.

Opportunity #1 Sky One Corporate Park, Pune from WiseX

Sky One Corporate Park is strategically located in Viman Nagar, Pune, adjacent to the International Airport, and is designed for IGBC Platinum Rating. This is a rare opportunity to acquire an A+ grade asset with a blue-chip MNC tenant at an attractive capital value.

Opportunity Highlights

  • Newly Constructed Building

  • Attractive Purchase Price (~15% Discount to Market Rate)

  • High Rental Yield (9.6% Gross Entry Yield)

  • Fresh Lease Agreement

  • NYSE Listed MNC Tenant with 5 year lease lock-in

  • Strategically situated abutting the Pune International Airport

Opportunity #2 Jaipur Flipkart Warehouse from PropShare

The asset comprises 3 boxes, all leased to Flipkart totaling 528,631 sf. This is Flipkart’s largest distribution cum fulfillment center in the West processing 2 lakh orders per day (5 lakhs during big billion days).

Opportunity Highlights

  • Yield: 9.1%
  • Pricing: Rs. 3,214 psf
  • Tenant: Flipkart
  • Lease tenure: 9-year lease with 4.3-year lock-in
  • Rental Escalation: 12.48% every 3 years
  • Location: Ajmer Road, Jaipur, the largest industrial market in Jaipur
  • Build Quality: A+ built-to-suit for Flipkart
  • IRR: 16.1% and 1.70x multiple

Opportunity #3 Japanese Auto Giant Opportunity - CBD, Bengaluru from hBits

Vaswani Centropolis is an iconic Grade A asset located in the Central Business District of Bengaluru with top-class amenities, superior location, and easy connectivity by road, metro, and railways. The building is located at the heart of Bengaluru city on Langford Road. With its warm sense of community and only moments to shops, eateries, and transport, this project provides all the elements for comfortable and easy-care working.

The tenant in this opportunity is Japanese Auto Giant who is rated as ‘A1’ by Moody’s.

Opportunity Highlights

  • Gross Entry Yield: 9%
  • Expected IRR: 15.6%
  • Minimum Investment: 25 Lakh
  • Rental Escalation: 4%
  • Lease Period: 5 years
  • Asset Value: ₹ 54.73 Cr
  • Majestic Railway Station: 4.5 km
  • Langford Town Metro Station: 2 km

Opportunity #4 Ayodhya Investment Opportunity I – Growth

This is not a commercial real estate opportunity, but a pure fractional real estate opportunity in a land parcel in Ayodhya city. Fractional ownership in land parcels will be managed by using blockchain technology. Due to the opening of the Sri Ram temple in Ayodhya this year, a large influx of devotees and tourists is expected in this sacred city. The region is undergoing rapid development, offering immense prospects for urbanization.

Opportunity Highlights

  • Lock-in: 4+ years
  • Pricing: Rs. 2800 psf
  • Location: New Ayodhya
  • Rental Yield: NA
  • Expected Returns: 2x
  • Hurdle Rate: 10%
  • Trustee: Amicorp
  • Distance from Ram Janm Bhoomi: 14 Km (approx)
  • Distance from Railway Station: 8 Km (approx)
  • Distance from Airport: 7 Km (approx)

Planning to Invest?

For more information about these opportunties book appointment with us.

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