Vaishnavi Tech Park

Opportunity II
Investment Note

www.myrecapital.com
 Vaishnavi Overview

Tech Park II MYRE Capital is offering a rare

opportunity to invest in 36,230 Sq. Ft. of
A+ Grade Office space, strategically
situated off the Outer Ring Road, adjacent
Strategy Location to the Sarjapur Junction, Bangalore. The
ORR, Sarjapur Junction, Bangalore proposed space spans the entire 4th floor
of newly constructed South Tower in
Vaishnavi Tech Park.
Marquee Tenant The entire tower is leased to Smartworks,
Tenant : SmartWorks the market leader in Managed Workspace
Solutions. Smartworks has subleased our
Sub Tenant : Groww premises to Groww. Most recently funded
by Satya Nadella, Groww is one of the
largest mutual fund investment platforms
in India.
Highlights

Average Target Lease Minimum

Yield IRR Tenure Investment

8.8% 15.9 % 9 years ₹ 25 Lacs

Location

▪ Bangalore Overview
▪ Micro-Market Insights
▪ Infrastructure
▪ Connectivity
▪ In The Vicinity
 INDIA’S TECHNOLOGY HUB Bengaluru
Overview

34%
Headquarters of Wipro, Infosys, Flipkart, Phonepay, Accenture,
IBM, Cisco LARGEST OFFICE
HUBS IN INDIA
Of India’s Global Bengaluru is Fastest-Growing Metro City in the World.
Capabilities Centres 176+ MSF
Bangalore is widely regarded as

13.4
51%
12.5

the "Silicon Valley of India" (or

GROWTH "IT capital of India") because of
Net Absorption
11

its role as the nation’s

9.8

9.8
10
2022F over
9.2

9.2
8.8
8.7

2021 leading information

37% technology (IT) exporter. Indian

6.5
7

New Supply technological organizations are

5.3
6

headquartered in the city.

Net Absorption
New Supply
Did you
2016 2017 2018 2019 2020 2021 2022F
know?
Bangalore has
emerged as the
AREA POPULATION LITERACY RATE world’s fastest-
8,055 SQ. KM 8.44 MILLION 88.6% growing tech
ecosystem!
Source 1: Marketbeat Bengaluru, Office Q4 2021, Cushman & Wakefield
Source 2: Economic Times
 Micro Market Overview
Vaishnavi Tech park is located strategically at

Doddaballapur
the intersection of Outer Ring Road (ORR) and

Road
Sarjapur Micro Market. ORR is the largest IT
corridor of Bangalore whilst the Sarjapur Micro
Market has a 0% vacancy rate. Suburban North

Vacancy Rate : 21%

Stock : 3.9 MSF

Outer Ring Road

Central Business
District
Outer Ring Road
Vacancy Rate : 10% Magadi Road
Stock : 8.5 MSF Vacancy Rate : 9.3%
Stock : 85.6 MSF

Secondary Business Sarjapur

District
Vacancy Rate : 0%
Vacancy Rate : 15% Stock : 2.9 MSF
Stock : 26.9 MSF

Source: Bangalore Overview Report, JLL

 Infrastructure
With proximity to 2 upcoming Metro Stations (Ibbalur Station
and Bellandur Station) and the Outer Ring Road, Vaishnavi Tech
Park has Excellent Connectivity.

CBD

EDD PBD-W

Old Madras
Road

Outer Ring
Bellandur Road
SBD Ibbalur Station
Station

Outer Ring
Road

PBD-E

Hosur
Road
Operational
Under Construction
In the Vicinity
Hindustan Aeronautics
Karnataka Golf Limited Airport
Association KADUBEESANAHALLI
Tenants in
the Vicinity
BELLANDUR
Kodibisanahalli
Novotel Station

Bellandur Lake Bengaluru

Bellandur
Fairfield by Marriott HCL
Station
Technologies
Soul Space Spirit
Central Mall
Ecospace
Deloitte
Ibbalur
Station Microsoft Prestige Ferns Galaxy

Accenture
HSR LAYOUT
Manipal Hospital
Vaishnavi
Tech Park

Double Tree Suites by

Hilton
Play Arena

Oracle Solution Services

Wipro Limited
Opportunity Insight

▪ Vaishnavi Tech Park

▪ Building Overview
▪ Asset Images
▪ Floor Plan
▪ Managed Leasing
▪ Tenant Overview
▪ Lease Overview
▪ Lease Comparable
 Discover Vaishnavi Tech Park PROJECTS HIGHLIGHTS

Located off the Outer Ring Road, very close to the Sarjapur Junction, Vaishnavi Tech Park is a
multi-functional IT and Business Park with a contemporary design. Designed for IGBC
platinum certification, the building will be energy efficient for environmentally conscious
occupiers while at the same time significantly optimizing the operational expenditure.

OFFICE SPACE
Thoughtful amenities such as Cafeteria, food court,
A-Grade commercial landscaped gardens and spaces for recreational activities
space

Two flanking wings with

services at both ends

Well connected & easy

access to public
transport avenues via
Sarjapur Road & ORR Energy
Efficient &
Sustainable
Designed for IGBC Total Office Space : 8 lakh sq. ft Area : 5.6 Acres Architecture
Platinum rating

Source: Vaishnavi
 Building Overview [South Tower]

▪ New Building : The tower has been newly

constructed with state-of-the-art
construction technology to deliver superior
quality.

▪ Professional Management : Smartworks

has signed a lease for the entire building and
is responsible for the upkeep and
management of the building Floor 10 : Discovery

▪ Strong Demand : The building is already Floor 09 : Discovery

majorly occupied by blue chip sub-tenants Floor 08 : Discovery
and is expected to be at 100% sub-tenant
occupancy by April 2022. Floor 07 : Ocwen
Floor 06 : Ocwen
▪ A-Grade Building : IGBC Platinum Rated
Floor 05 : Groww
Floor 04 : Groww
Floor 03 : Groww

Floor 02 : Groww
Floor 01 : Advance discussions
 Floor Plan

▪ High Floor Plate Efficiency: The 80%+ floor

plate efficiency is significantly above market
average.

▪ Floor Plate Sub-Divisibility: The floorplate

can be subdivided into multiple independent
units, providing flexibility for re-leasing.
 Managed Leasing
Stable Tenancy : Leasing expertise
providing long term tenant stability.
Secure Rental : Dual protection
from managed leasing partner and
sub-tenant.
Vacancy Risk Mitigation : Tenant
Sourcing, management, and
vacancy responsibility of managed
leasing partner.
Superior Asset Upkeep : Value add
facilities, workspace digitization, and
BENEFITS professional building management.
OF High Stickiness : Managed leasing partner
invests high marketing costs, tenancy
MANAGED expenses, building upgradation and
furnishing capex.
LEASING Rental Assurance : The managed
leasing partner is responsible for the
rental payment irrespective of subtenant
vacancy.
 Tenant Overview Area Under Management
4+ MSF
▪ Smartworks is India’s largest and profitable provider of agile workspaces, serving 500+
Revenue Growth (2020-2021)
customers.
3x
▪ First flex-space operator to have PAN India presence.
Valuation
~ 3,000+ Cr
HURUN INDIA HAS NAMED SMARTWORKS TO
Enterprise Clientele
ITS FUTURE UNICORN LIST 2021 ~90%+

Large Area
> 50,000 SF
WEWORK SMARTWORKS “
SmartWorks alone
accounted for more
than 12% of India’s
total Commercial
Institutional Backing
Keppel Land,
Singapore

Smaller Area 300+ players

Office space

”
already in the INDICUBE
< 50,000 SF
segment
leasing.
B2C Enterprise

Source: Forbes
Leasing Expertise : SmartWorks
 Sub-Tenant : Groww

Valuation Revenue Growth

Groww is one of the largest fintech Unicorns in $3 Billion [FY21]
India. The company operates an investment [~INR 22,000 Cr] 14x
platform that allows investors to invest in mutual
funds and stocks. This year, Groww is one of the
few fintech companies to turn profitable with a
whopping 14x growth in revenue. Chairman and Total Total
CEO of Microsoft Corporation Satya Nadella has Customer Employees
joined Groww as an investor and advisor. 20 Million + 600+

Institutional Backing

Source: Groww
 Market Opinion About Tenants

”
Smartworks leases
200,000 sq. ft. in
Pune co-working
”
Smartworks
provides 600 seats
to Ocwen Financial
”
Smartworks leased
4.5 lakh sft office
space amidst Covid-
”
Groww turns
profitable as
revenue jumps 14-
”
Groww brings on
board Microsoft
chief Satya Nadella
centre Services 19 in Mumbai and fold in FY21” – VC as an investor,
Hyderabad Circle (19th advisor
January 2022)

Live Mint Live Mint The Economic Times VC CIRCLE The Economic
19 Aug 2021 03 Aug 2021 22 Jul 2021 19 Jan 2022 Times
08 Jan 2022

SmartWorks Groww
 Lease Terms
The tenant, Smartworks, has signed a lease for the entire building admeasuring ~ 4,00,000 Sq. Ft. Groww has further subleased
~1,40,000 Sq. Ft. from Smartworks including our floor. Smartworks will be spending significant capex in modification, fit-outs, and
furnishing costs for the entire building.

The lease terms entail an extended ~9-month effective rent-free fitout period for the tenant. MYRE Capital was able to negotiate with the
seller to reduce the effective rent-free period to only ~1.5 months.

Lease Interior Fit-Out Rental Lease High Security

Area & Furnishing Escalation Tenure Deposit
36,230 Sq. Ft Smartworks 15% Every 3 year 9 Years11 Months 4 months
From March 2023

Lease Timeline

1st April 2022 1st April 2027 1st March2032

Lease Start Lock-In End Lease

Date End
 Lease Comparable
Our rental is at a ~48% discount to the prevailing market rate, increasing the stickiness of
the tenant to the premises and providing significant scope for future mark-to-market
appreciation.

Source: CBRE Valuation Report

Financials

▪ Purchase Price Distribution

▪ Gross Yield Growth
▪ Projected Performance Metrics
Purchase Price Distribution

Price Break - Up

Particulars Values

Price Per Sq. Ft. ₹ 8,810

Area (Sqft) ₹ 36,230

Gross Price ₹ 31,91,86,300

Add : Stamp Duty ₹ 1,68,63,264

Add : Registration ₹ 29,74,121

Add : Acquisition Expenses ₹ 1,08,90,651

Add : Reserve ₹ 17,00,000

Add : Property Tax ₹ 41,67,175

Add : Legal Expenses ₹ 12,18,489

Net Purchase price ₹ 35,70,00,000

Gross Yield Growth

Entry Yield Average Yield

8.6 % 8.8 %

Yield Growth
9.5% 9.5%

9.5% 9.3%

9.0% 8.7% 8.7%

8.6% 8.6%

8.5% 8.3% 8.3%

8.0%

7.5%
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9

*All depicted numbers are ‘Gross’ performance metrics. Refer financial model for ‘Net’ values.
 Projected Performance Metrics
The target 9% CAGR, implies a 15.9% Gross IRR to investors with a MoIC of ~3.0x in a 9-year period

4.0% 6.0% 8.0% 9.0% 10.0% 12.0%

IRR MoIC

15.9% 3.0X
IRR 12.0% 13.5% 15.1% 15.9% 16.7% 18.3%

MoIC 2.2 2.5 2.8 3.0 3.2 3.6

Appreciation Drivers

Platinum New Building ~48% Discount Attractive Blue Chip Proximity to Strong Micro
Quality Asset & Fresh Lease To Market** Capital Value Tenants Upcoming Market
Metro Stations Fundamentals
*All depicted numbers are ‘Gross’ performance metrics. Refer financial model for ‘Net’ values.
**Source: Market Valuation carried out by CBRE for Subject Property
Investment Terms

Performance Fee
Management Fee Prebook Offer*

1% 20 % 4.30%
Over hurdle rate of 12% IRR

*Cumulative across ~7years. Applicable on investments that are confirmed prior 5th July
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