Embassy Office Parks REIT, the largest office REIT in Asia and India's first publicly listed REIT, has marked its most successful leasing quarter in Q3FY24. With a remarkable achievement, the company surpassed its annual leasing guidance in just nine months. In Q3FY24, Embassy REIT leased 3.5 million square feet (msf) of office space through 22 deals, contributing to a total of around 6.5 msf leased in the past nine months. Aravind Maiya, the CEO of Embassy REIT, emphasized the robust business environment in India, highlighted by pre-leasing 2.2 msf to three globally recognized companies. He anticipates continued growth in demand for premium office spaces as more multinational corporations establish their centers in India, reflecting the country's significance as a thriving business hub for Global Capability Centers (GCCs).
The company secured substantial pre-lease agreements totaling 2.2 million square feet (msf) with three major multinational entities, encompassing a prominent Australian bank, a leading American retail corporation and a US-based technology company. Additionally, the REIT successfully refinanced Rs 2,600 crore at an average rate of 8.25%, incorporating the issuance of commercial paper worth Rs 1,000 crore for the first time. The recent sponsor stake sale garnered significant investor interest, resulting in an increased public float of 92% and establishing a diversified unitholder base with blue-chip credentials. In Q3 FY24, the REIT achieved a net operating income (NOI) of Rs 760 crores, indicating an impressive 8% year-on-year growth. Revenue for the same quarter stood at Rs 936 crores, reflecting an 8% increase compared to the corresponding period in the previous year.
In a Board Meeting held on Friday, Embassy Office Parks Management Services Private Limited (EOPMSPL), the manager to Embassy REIT, declared 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 the 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, along with a continuously expanding retail base. Furthermore, the company boasts a development pipeline of 6.9 msf, with Bengaluru accounting for 90% of 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.