Availed moratorium only on hospitality, retail loans: Brigade Enterprises

Brigade Enterprises, a Bengaluru-based real estate developer, has availed itself of a moratorium only for its hospitality and retail loans.

“The company has not taken a moratorium on all the loans. It has been taken only on hospitality as well as the retail loans,” Atul Goyal, CFO, Brigade Group told BusinessLine . “We have been paying our office and residential loan commitments every month.”

The company’s net debt outstanding as on June 30, 2020 stood at ₹3,624 crore.

MR Jaishankar, Chairman and Managing Director, Brigade Enterprises, said: “The company focussed on collections of lease rentals in the first quarter of FY21. Our teams achieved 98 per cent overall collections during the Covid-19 pandemic.”

“While tenants reviewed their rental cost, luckily, we did not have to renegotiate or provide any rental waiver for all the lease deeds that we have with us, except for some stray cases, where we have to give some additional time for them to pay the rentals,” he added.

On the leasing front, the company saw very little activity and site visits during the lockdown. It also saw postponement of decision since most occupiers were focussing on business continuity and pursuing work from home.

Leasing pipeline

Jaishankar said: “We have an active leasing pipeline of about 0.6 million sq ft in Bengaluru and about 200,000 sq ft in Chennai. We see opportunities of consolidation and tenant relocation away from typically high priced zones, which make us optimistic about our leasing prospect at Brigade Tech Gardens in Bengaluru. In Chennai, we have good traction from our existing tenants itself.”

The company’s retail business faced a tough Q1 due to the severe lockdown imposed in Bengaluru where all its malls are located. “The focus has been the retention and renegotiation of leases and collection of outstanding payment from our tenants. We have approached the situation fairly in a very reasonable manner and offered a 50 per cent rental waiver during the lockdown,” explained Jaishankar.

He added: “Since reopening, malls across the city, ours included, have been grappling with low footfalls of 20 to 25 per cent of the normal figure despite stringent measures taken to protect shoppers. We expect this segment will take some more time to normalise and with some long-term structural shift towards online retailing that has been accelerated by the coronavirus. However, we are still confident that in the long run, there will always be a requirement for well-designed retail spaces in underserved locations, providing a combined experience of food, entertainment and shopping.”

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