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Nexus Select Trust has acquired Vega City Mall, a 96% leased shopping center in South Bengaluru, strengthening its retail presence in the city. The acquisition, completed at 10% below valuation, is expected to generate a Retail Net Operating Income of INR 78 crore and boost Net Distributable Cash Flow by INR 20 crore after debt servicing. Funded through non-convertible debentures at a 7.70% coupon rate, the deal keeps Nexus's Loan-to-Value (LTV) ratio at 17%. CEO Dalip Sehgal emphasized the mall's prime location and potential for leasing, operational, and marketing synergies, reinforcing Nexus's growth strategy in India's retail market.
Nexus Select Trust has officially acquired Vega City Mall, a prominent shopping center located in a wealthy area of South Bengaluru. This mall is notable for being 96% leased to a variety of both international and domestic brands. Its location near an upcoming metro station makes it easily accessible for shoppers, enhancing its appeal. Advertisement
This acquisition marks Nexus Select Trust's fourth property in Bengaluru, a city recognized for its strong consumer market. The addition of Vega City Mall is expected to create operational efficiencies and contribute to the trust's long-term growth strategy. By expanding its portfolio in Bengaluru, Nexus aims to capitalize on the city's vibrant economy and increasing retail demand.
The deal was completed at a favorable valuation, approximately 10% below the independent appraisal. This strategic purchase is projected to generate a stabilized Retail Net Operating Income of INR 78 crore. Furthermore, the acquisition is expected to increase the Net Distributable Cash Flow (NDCF) by INR 20 crore after accounting for debt servicing. Nexus Select Trust funded the acquisition entirely through listed non-convertible debentures, issued at a 7.70% coupon rate in the third quarter of FY25. Following this transaction, the Loan-to-Value (LTV) ratio stands at 17%, indicating a strong financial position.
Dalip Sehgal, the Executive Director and CEO of Nexus Select Trust, expressed confidence in the acquisition, stating that it aligns with the trust's commitment to enhancing its portfolio through quality assets. He highlighted that the mall is situated in a densely populated area, which strengthens Nexus's footprint in Bengaluru-one of India's most dynamic retail markets. The acquisition not only enhances the trust's scale but also positions it to leverage synergies in leasing, operations, and marketing.
Looking ahead, Nexus Select Trust plans to continue pursuing growth opportunities, particularly in high-demand markets like Bengaluru. The company's existing strong balance sheet will allow it to explore further acquisitions that can drive value for its unitholders. As the retail landscape evolves, Nexus aims to adapt and thrive, ensuring sustainable growth in a competitive environment.
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