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Embassy Office Parks REIT, Asia's largest office REIT by area, recorded its highest-ever first-quarter leasing performance with 2.0 million square feet transacted across 25 deals. The firm noted a 13% year-on-year rise in revenue and a 15% increase in net operating income. Strong pre-leasing activity was witnessed in Chennai, and the REIT raised INR 4,225 crores in debt to capitalise on favourable market conditions. Additionally, it initiated the divestment of strata-owned blocks in Bengaluru and explored new development opportunities in Whitefield.
Embassy Office Parks REIT, India's first publicly listed Real Estate Investment Trust and the largest office REIT in Asia by area, released its operational and financial performance for the first quarter of FY2026, ending in June. The company reported its highest-ever Q1 leasing performance, having leased 2.0 million square feet across 25 transactions. This includes approximately 1.0 million square feet of new leases, 360,000 square feet of renewals, and 665,000 square feet of pre-leased space. Advertisement
Chennai emerged as a notable growth centre, leading the REIT's pre-leasing momentum with over 500,000 square feet leased at Embassy Splendid TechZone. A significant portion of this was taken by a global healthcare company. Meanwhile, Bengaluru assets-comprising 75% of the REIT's Gross Asset Value-maintained occupancy above 90%, with six properties reaching full occupancy. Global capability centres remained the principal rental contributors, accounting for 64% of total rentals.
Financially, the REIT posted a 13% year-on-year increase in revenue from operations to INR 1,060 crores, while net operating income rose by 15% to INR 872 crores. It distributed INR 550 crores to unitholders for the quarter, equating to INR 5.80 per unit, representing a 4% year-on-year growth.
In a strategic financial move, Embassy REIT secured INR 4,225 crores in debt at a blended interest rate of 7.18%. This included a notable INR 750 crore non-convertible debenture issuance at a 6.97% coupon-the lowest rate achieved by the REIT in four years.
From an asset management standpoint, the REIT signed binding agreements for the divestment of approximately 376,000 square feet of strata-owned space at Embassy Manyata in Bengaluru, as part of a capital recycling strategy. Additionally, it received an invitation from Embassy Developments Limited to evaluate participation in a potential 3.3 million square foot commercial project in Whitefield, Bengaluru.
Embassy REIT's ongoing development pipeline across Bengaluru and Chennai now stands at 6.1 million square feet, of which around 60% is already pre-leased, indicating strong forward demand.
Source - PTI
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