Embassy REIT Surpasses 6.5 Million Sq Ft Leasing Goal in 9 Months
Embassy Office Parks REIT, the leading office REIT in Asia and India's inaugural publicly listed REIT, has achieved an exceptional leasing performance in Q3FY24. Surpassing its annual leasing target in just nine months, the company leased 3.5 million square feet (msf) of office space in Q3FY24 across 22 deals, contributing to a total of approximately 6.5 msf leased within the past nine months. Aravind Maiya, the CEO of Embassy REIT, underscored the vibrant business environment in India, particularly evident in pre-leasing 2.2 msf to three globally recognized companies. He foresees a sustained uptick in demand for high-quality office spaces as more multinational corporations establish their centers in India, underscoring the nation's role as a thriving business hub for Global Capability Centers (GCCs).
The firm secured significant pre-lease contracts totaling 2.2 million square feet (msf) with three major international corporations, including a well-known Australian bank, a leading American retail giant, and a US-based technology firm. Moreover, the REIT effectively refinanced Rs 2,600 crore at an average interest rate of 8.25%, involving the issuance of commercial paper amounting to Rs 1,000 crore for the first time. The recent sale of sponsor stakes attracted substantial investor interest, resulting in a heightened public float of 92% and establishing a diverse unitholder base with prestigious credentials. In Q3 FY24, the REIT achieved a net operating income (NOI) of Rs 760 crores, signifying an impressive 8% year-on-year growth. Revenue for the same quarter reached Rs 936 crores, reflecting an 8% increase compared to the corresponding period in the previous year.
In a recent Board Meeting, Embassy Office Parks Management Services Private Limited (EOPMSPL), the manager of Embassy REIT, announced a distribution of Rs 493 crore or Rs 5.2 per unit for Q3 FY2024. The record date for this distribution is February 12, 2024, with payment scheduled on or before February 17, 2024. The REIT's public shareholding has surged from 30% at IPO to an impressive 92% as of December 2023, resulting in a diverse unitholder register comprising global and domestic institutions, alongside a continuously expanding retail base. Additionally, the company holds a development pipeline of 6.9 msf, with Bengaluru contributing 90% to this pipeline and delivering a yield exceeding 20%. The hotel portfolio demonstrated robust performance, maintaining a 55% occupancy rate, achieving a noteworthy 19% year-on-year ADR growth, and generating an EBITDA of Rs 50 crore.