Information Memorandum - Primeco Towers, Bangalore

1

Information Memorandum - Primeco Towers, Bangalore

Strictly Private and Confidential

[Grade-A IT Office ⸰ 5star Hotel, Hyatt ⸰ Leased Retail]

June 2021

ExcellentLocation

10.50%Gross Yield

5.50 yearLock-in

• Lease Start Date is post Covid, Sep 2020.

• New Asset | Part of larger development neighboring 5 star hotel (Hyatt)

• US based Grade-A technology Tenant

• Tenant is locked-in for 5.50 years out of a total term of 9 years

• Tenant has been paying rentals timely and regularly through the Covid pandemic

• Walking distance to upcoming metro

• High going-in yield for a Grade A + asset in Bangalore

• Buying Rate comparable to premium residential rate in the close proximity.

• Excellent location with good connectivity via road and METRO

Grade A+Tenant

Covid led VacancyLow RISK

2Private and Confidential

COMPELLING INVESTMENT RATIONAL

SUPERIOR LEASE TERMS LIMITS RISK

March

2026

Lease sign Lock-in End Lease End Date

Dec

2019

Sep

2029July

2021

Invest

+4 years into Covid

WFH ends per est.

Grade A Office supply shrinks

Tech Cos continue to grow as digitization explodes

Dec

2024

May

2020

Lease

Registration

Sep

2020

Rent Start

Post Covid


STRONG LOCATION, QUALITY ASSET

Primeco TowersBannerghatta Road, Bangalore

Pre-leased 34,276 sft. in, located on main

Bannerghatta road, prime business district.

Mixed use Grade A+ completed asset with

office, retail and hotel.

Hosts major tenants:

Paychex, BIAS, Huron, Neustar, Central mall

etc.

An intimidating glass-clad building equipped

with 3 basements, grand lobby and podium.


PRIMECO Towers is a mixed use

Grade A+ development with prime

offices, retail and Hyatt Hotel.

It hosts some major players like

Paychex, BIAS, Huron, Neustar,

Central mall etc.

Its intimidating glass-clad building is

equipped with three level basement

car parking, a grand entrance lobby

and podium with vibrant spaces.

PRIMECO TOWERS


AREA BREAK-UP

Land Area 6.5 acres

Saleable Area 1.30 million sft.

Retail- A 2.00 lac sft.

Office- B 9.60 lac sft.

Hotel- C 1.33 lac sft.

Office Floor Plate ~80,000 sft.

Floor Efficiency ~75%

Elevators 10 Passenger + 3 Service

with 20 persons capacity

Escalators 6

Power back 100%

Specifications Warm-shell standard

specification with high side

AC


TENANT – USA BASED TECHNOLOGY COMPANY

Neustar Inc. is a part of the Lockheed

Martin(American defense company). It’s unique

capabilities have made it the leader in the field of

Customer Analytics, Risk and Compliance,

Network & Communication and Security & Web

management services.

Chicago | Los Angeles | Louisville | New York | San Diego

San Francisco | Costa Rica | London

VA, USA Headquarter

Founded 1996

Customers 8,000+

Revenue US $700+ Million

Listed NYSE

Neustar helps top brands in technology, insurance,

internet , online banking, retailers etc.

Few of the Neustar clients:


BASIC LEASE TERMS

Leased Area 34,276 sft.

Car-parking 45

Rent Commencement September, 2020

Monthly Rent Rs. 115/ sft.

Lease Term 9 Years

Lock-in period 5 years 6 months

Security Deposit 4.36 Cr. (12 months)

Lock In ends March, 2026

Rent Escalation 5% every year


Shot at site

NeustarAverage in the same

buildingMarket benchmark*

71 77 80-85

Warm Shell Rent Benchmarking (Rs./sft/month

*As per latest market info on latest lease at Kalyani magnum

Prominent Occupiers in the Primeco Towers

Primeco Towers itself hosts several IT MNCs and other companies.


EXCELLENT CONNECTED LOCATION


WALKING DISTANCE TO UPCOMING METRO & JUST 3 KMS FROM

OPERATIONAL METRO STATION

1111

Private and Confidential

PRIMECO TOWERS- MAJESTIC TRIPLE HEIGHT ENTRANCE PLAZA

Shot at site


PRIMECO TOWERS- TOWER LIFT LOBBIES

Shot at site


PRIMECO TOWERS- ELEGANT EXTERNAL LANDSCAPES

14

Shot at site


PRIMECO TOWERS- GRAND TRIPLE HEIGHT RECEPTION LOBBY

Shot at site


PRIMECO TOWERS- RECEPTION LOBBY WITH ESCALATORS

Shot at site


PRIMECO TOWERS- VIBRANT PODIUM WITH CAFES AND RESTAURANTS

17

Shot at site


PRIMECO TOWERS- MASTER PLAN


PRIMECO TOWER B –TYPICAL FLOOR


PROMINENT OCCUPIERS IN THE IMMEDIATE VICINITY

The asset is located in a well established business, retail and housing hub.

several major Indian companies, hospitals, institutions and MNCs in and

around its vicinity


21

Modern good quality fit-outs with all motorized height adjustable workstations

Shot at site 21Private and Confidential

22

Fit-outs with Covid compliant working standards

Shot at site 22Private and Confidential

Assumption

Year 8 is assumed as the year of exit for calculations

Return Projections – 8 Year Average

Yield – Gross 10.50%

Yield – Net off Property Tax 10.40%

Yield – Net off YA fee, and Property Tax 9.90%

Gross IRR 12.59%

Net IRR 11.91%

STRONG FINANCIAL PROJECTIONS


Particulars Amount (INR) Details

Total office area to be purchased 34,276 sft. with 45 car parking 75% carpet area efficiency

Purchase Price 50,00,00,000 • INR 14,587 per sft.

Add: Stamp duty 2,85,00,000 • 5.70% of Purchase Price

Add: Registration Charges 50,00,000 • 1.00% of Purchase Price

Add: Property Acquisition fee 1,50,00,000 • 3.00% of Purchase Price

Add: Legal fee 10,00,000 • As per Estimation

Add: Reserves 25,00,000• Contingencies : 0.50% of

Purchase Price

Total Purchase Price 55,20,00,000

COST DETAILS


YIELD

Your investment will yield a net yield of 8.31% in the first year of investment. This

yield will increase every year due to 5% escalation in rentals every year.

INR per sft. Year 1 Comments

Going in gross rent psft. 1385.23 Rs. 115 / sft. / month

Add: Interest on Deposit 63.60 Interest at 5.00% per annum

Total Gross Yield 1448.83

Less: Property Tax (30.00) Rs. 2.50 / sft. / month

Less: Management Fee (80.52) 0.50% of purchase price per

year

Net Yield 1338.30

Total Purchase Price per sft. Rs.16,105

Net Yield 8.31%


STRONG PROJECTED YIELD AND RETURNS

8.31%

8.74%

9.19%

9.67%

10.16%10.51%

11.05%

11.61%

4.00%

6.00%

8.00%

10.00%

12.00%

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8

Net Yield Growth

Investment amount Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8

25,00,000 17,313 18,209 19,149 20,137 21,174 21,887 23,012 24,193

50,00,000 34,625 36,417 38,299 40,275 42,349 43,774 46,024 48,386

75,00,000 51,938 54,626 57,448 60,412 63,523 65,661 69,036 72,578

1,00,00,000 69,251 72,835 76,598 80,549 84,698 87,549 92,047 96,771

Net Income in hands of investors per month in each year (INR)


A projected investment of Rs.

25,00,000 will see an

estimated return of Rs.

17,313 per month in year 1

and Rs. 21,174 per month in

year 5.

FINANCIAL PROJECTIONS

Very attractive purchase price for a grade A+ office space with

warm shell specifications and Fit-outs plus 45 car parking. Rate is

comparable to premium residential rate in the close proximity

Particulars (INR) Day 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Total

Investment (55,20,00,000) - - - - - - - - (55,20,00,000)

Rentals - 4,74,80,026 4,98,54,027 5,23,46,728 5,49,64,065 5,77,12,268 5,96,00,476 6,25,80,500 6,57,09,525 45,02,47,615

Interest on deposit - 21,79,954 21,79,954 21,79,954 21,79,954 21,79,954 21,79,954 21,79,954 21,79,954 1,74,39,629

Gross Income - 4,96,59,979 5,20,33,980 5,45,26,682 5,71,44,018 5,98,92,221 6,17,80,430 6,47,60,454 6,78,89,479 46,76,87,244

Property Tax - (10,28,280) (10,28,280) (10,28,280) (10,28,280) (10,28,280) (10,28,280) (10,28,280) (10,28,280) (82,26,240)

Income - Net of Property

Tax - 4,86,31,699 5,10,05,700 5,34,98,402 5,61,15,738 5,88,63,941 6,07,52,150 6,37,32,174 6,68,61,199 45,94,61,004

Management fee - (27,60,000) (27,60,000) (27,60,000) (27,60,000) (27,60,000) (27,60,000) (27,60,000) (27,60,000) (2,20,80,000)

Income - Net, YA Fee &

Property Tax - 4,58,71,699 4,82,45,700 5,07,38,402 5,33,55,738 5,61,03,941 5,79,92,150 6,09,72,174 6,41,01,199 43,73,81,004

Exit Value - - - - - - - - 67,81,61,068 67,81,61,068

Pre tax net cash flows (55,20,00,000) 4,58,71,699 4,82,45,700 5,07,38,402 5,33,55,738 5,61,03,941 5,79,92,150 6,09,72,174 74,22,62,267 56,35,42,072

Gross IRR 12.59%

Net IRR 11.91%

Profit on investment Rs.56,35,42,072

MoIC 2.08x

Note: Please refer the financial model for more details


SENSITIVITIES

1.00% 2.00% 3.00% 4.00% 5.00%

Net IRR 10.74% 11.47% 12.20% 12.95% 13.71%

Multiple 1.93x 2.02x 2.11x 2.22x 2.32x

Sale Price Psft. (INR) 17,439 18,869 20,401 22,040 23,794

Profit on total

investment (INR)

48,31,17,905 53,21,36,982 58,46,38,089 64,08,31,120 70,09,36,409

Even on a conservative capital appreciation of 2% per annum, the investment will yield net

compounded returns of 11.47% per annum and 2.02x MoIC

Sensitivities to capital appreciation


Risk Level

Completion risk None - Fully constructed

Leasing risk Low - Investment linked to preleased rentals, locked in for 5.50 years

Title risk Low – Freehold property

Approval riskNone - OC approved building from BBMP. Development plans

approved by local government authority (BBMP & BDA)

Vacancy

Low- Neustar has signed the lease during the Covid pandemic and

considering a long lock-in period and high profitability, the vacancy risk

is significantly low

KEY RISKS



KEY INVESTMENT TERMS

Shot at site

Investment AmountMinimum- INR 25 lacs

(can be scaled in the multiples

of INR 5 lacs)

Management Fee0.50 % of the invested amount

per annum

OWNERSHIP STRUCTURE

Manages all

the cash

flow

Manages the asset

Securities of SPVissued to investors

*Special Purpose

Vehicle

Escrow Agent /Trustee

Investor

SPV *

Asset

YieldAsset Facilitator


Yield Asset is a tech platform disrupting

real estate investing for small investors.

We offer fully vetted real estate investment

opportunities with fractional ownership.

Yield Asset aims to offer compelling risk-

adjusted pocket friendly opportunities.

Our vision is to be the most trusted

platform for real estate investments with

asset-level transparency and ease of

liquidity.

ABOUT YIELD ASSET


Investment in rental yielding commercial

real estate has generated great wealth to

investors. However, it has been available

only to those with right connections and

deep pockets. This asset class and its

benefits has been out of reach for most of

people.

Yield Asset’s endeavor is to simplify the

investment process and pocket-size the

investment amount so that small investors

can add its benefits to their investment

portfolio.

WHY YIELD ASSET


Experienced Team

▪ +50 years of investing

experience collectively

▪ “Feet on the ground” real

estate knowledge

▪ Diversified board for industry

leading governance

• End to end service including

screening, investment, lease

management and administration.

• Provide granular details and

disclosure

• Regular updates

• Lower fee compared to

market

• We align our fee over the

property ownership cycle to be

fully committed.

• Secondary sale of securities on

platform

• Wider investor base for deeper

market and better liquidity

Our members to have friction-less access to pre-screened

commercial real estate investment opportunities

• We offer only pre-screened

properties.

• Fully vetted through rigorous due-

diligence process

• Provide regular reports and access

to investment dash board.

• Active property management

• Active engagement with

tenants.

• Management of compliance,

accounts and rent distribution

Curated opportunities Lower Fee

Full service with

transparencyActive Property

ManagementEase of Liquidity


RAJESH BINNER

Co-founder, Investment

20+ years experience in real

estate

• Real estate Development

• FDI Investments

• Banking & Finance

• Leasing

• Advisory & deal structuring

MBA, Mumbai University

GOUTAM

Director Sales & Operations

We have a strong team with extensive experience in institutional real estate

investing and technology.

EXECUTIVE TEAM

20+ years experience

• Leasing, Sales, Marketing

and CRM

• Mixed-Use development

specialist

• Work experience from

International Markets i.e.,

Dubai and Dhaka

MRICS33

Private and Confidential

Chartered Accountant

Kalpesh is a tax expert and currently a partner at

Deloitte India. He has rich expertise in taxation and

deal structuring aspects in the fields of investment

trusts, mergers and acquisitions, private equity, etc.

Previously, he was a Partner at BMR Advisors and

worked at Ernst & Young.

KALPESH MAROO

PARTNER – DELOITTE INDIA

MENTOR

MBA, ICFAI

Navin has rich experience in the real estate industry

across asset management, real estate management,

financial structuring, corporate finance, etc.

Previously, he was a senior Principal at Piramal fund

management and a senior Vice President at Walton

Street India.

NAVIN DHANUKA

MANAGING PARTNER - UNITERN ADVISORS

ADVISOR

OUR MENTOR & ADVISOR


Commercial real estate refers to properties used for business purpose and yields regular rental income. It

includes office space, retail malls, industrial/ warehouse spaces etc. It serves as a hedge against inflation and

appreciates as the economy grows.

.

Commercial Real Estate (CRE)

An unexplored asset class for non Ultra HNI investors


Non-Correlated

The performance of commercial real

estate is not closely correlated with

stocks and bonds.

Capital Preservation

Real estate, when properly managed, is

a hard asset that preserves capital.

Cash Flow

Commercial real estate

can generate stable and

predictable cash flow.

Debt/ FD

Mutual

FundsEquity

CRE

We help you build

Institutional grade CRE

portfolio

Low Risk

High Risk

Lower Returns Higher Returns

Earn rentals, create a more

defensive portfolio with commercial

real estate and improve your risk-

adjusted returns.


CRE INVESTMENT IS BETTER

Residential Commercial (CRE)

Rental Income Ranges 2%-4% p.a. of capital investment Ranges 7%-11% p.a. of capital investment

Capital

Appreciation

Depends on comparable properties which is

hard to ascertain and grows at a slower

pace.

Depends on demand for office space which

grows at a fast pace every year and can

lead to higher appreciation

Quality of

Tenant

Individuals.

Not easy to assess and ascertain thus

exposed to default risk

Corporate/ MNCs

Assessable and hence one can reduce

default risk

Lease TermShorter that ranges between 6 and 12

months

Longer well documented and negotiated

lease terms that ranges between 5 and 10

years with lock-in period etc.


CRE STAGES TO INVEST AND RISK PROPOSITION

Risks Under constructionCompleted and un-

leased

Completed and

leased

Zoning

Title

Vacancy

Completion

Leasing


Investment scenarios in CRE- Grade A

Type of ownership Who invests Challenges

Exclusive OwnershipMainly available to Ultra HNIs

Family offices, Institutions

Competition with the developers for

leasing, not available to smaller investors

Factional Ownership

bought from builder

Bought by HNIs and Ultra HNIs,

only UDS is registered, area

bought remains unmarked

Property is managed by builders who

generally charge high margin. Dependency

on builder for tenant and property

management. not available to non HNI

investors

Group BuyingGroup of known HNIs invest

jointly in a property

Property and tenant management.

Generally exit is a issue not available to

smaller / average investors

Fractional Investment

with fractional ownershipSmall average investors, HNIs Ownership is through SPV


FRACTIONAL OWNERSHIP

Method of part ownership via a SPV

where multiple investors get fractional

exposure to a high value tangible asset

and thereby capturing benefits of high

yielding asset while mitigating risk.

• Start investing with small capital in

grade A commercial properties which

otherwise is not available to non HNI

investors.

• Diversify your portfolio by investing

in multiple properties fractionally.

• Better efficiency: Buying big with

Fractional investment enables high

ticket size properties which have

higher floor efficiency which leads to

better rental income.

• Grade-A assets of can be

purchased. These properties are

leased to grade A tenants with very

secure lease deeds with detailed and

well negotiated lease terms.

• Low Vacancy: Fractional

Investment is normally done in

pre-leased Grade-A assets which

tend to have lower vacancy levels

and risks

• Property and tenant management:

Managed by professionals,

hassle-free regular income.


YIELD ASSET HELPS INVESTORS OWN

INSTITUTIONAL GRADE REAL ESTATE AND

DIVERSIFICATION WITH FRACTIONAL

OWNERSHIP


www.yieldasset.com

Disclaimer: Yield Asset and its affiliates are in brokerage and listing of real estate opportunities. This material should not be construed as an offer to sell or the solicitation of an offer to

buy any security in any jurisdiction where such an offer or solicitation would be illegal. We are not soliciting any action based on this material. This document is for the general “information

only” and is not, and under no circumstances is to be construed as, an offer to sell or a solicitation of an offer to buy any securities, derivatives of any security or as an offer to provide any

portfolio management services, investment advisory services or any securities market related services. This document has not been registered with or approved by any supervisory or

regulatory authority. Nothing contained herein may be relied upon as a guarantee, promise, assurance, or a representation as to the future. No assurance can be given that the objective

or strategy or vision or mission regarding the services offered by us will be achieved or that the participants will receive return of their principal deployed or not incur losses, including loss

of principal deployed. The recipient is cautioned not to put undue reliance on any of the assumptions, scenarios, projections, representative data, expected yields or other information

contained herein. Certain transactions including those involving real estate investments, futures, options, and other derivatives as well as non-investment-grade securities give rise to

substantial risk and are not suitable for all investors. The material is based on information that we consider reliable, but we do not represent that it is accurate or complete, and it should

not be relied on as such. Opinions expressed are our current opinions as of the date appearing on this material only. We endeavor to update on a reasonable basis the information

discussed in this material, but regulatory, compliance, or other reasons may prevent us from doing so. The recipients should also note that there can be no assurance that any of the

prospective opportunities described in this document will be consummated or any other arrangement with any other person will fructify, or in either case continue even if consummated or

fructified. Please ensure that you have read and understood the risk involved in any investment decision before entering any transactions.

Mayank - +91 96209 99001 | Ayush +91 84858 19894

Email – [email protected]

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Information Memorandum - Primeco Towers, Bangalore

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