Embassy REIT leases 8.1 million sq ft office space in FY24, surpass guidance by 35%

Embassy Office Parks REIT, India’s first listed REIT, has leased 8.1 million sq ft office space in 2023-24, surpassing the full-year guidance by 35% led by global capability centres (GCCs) and multinational companies.

The firm has set an initial guidance of 6 million sq ft for the last fiscal and has set a guidance of 5.4 million sq ft of total leasing for 2024-25.

“We delivered 2.2 million sq ft of new office development, and we recently announced our intent to acquire, demonstrating our commitment to driving growth for all our stakeholders,” said Aravind Maiya, CEO, Embassy REIT.

Embassy Office Parks REIT has recently announced an acquisition of Embassy Splendid TechZone (‘ESTZ’) in Chennai for an enterprise value of up to Rs 1,269 crores and an institutional placement of up to Rs 3,000 crores, subject to unitholder approval and other conditions.

Embassy REIT’s revenue and net operating income grew by 8% on-year to Rs 3,685 crore and Rs 2,982 crore, respectively, during 2023-24.

The REIT has declared a distribution of Rs 495 crore or Rs 5.22 per unit for the fourth quarter of 2023-24. With this, the cumulative distribution for 2023-24 totals Rs 2,022 crore or Rs 21.33 per unit. The record date for the distribution is May 06 and the same will be paid on or before May 10.

It has proposed distributions in the range of Rs 22.40 to Rs 23.10 per unit for 2024-25, a 7% on-year growth at the mid-point.

The firm has refinanced Rs 4,100 crore of maturing debentures at an average rate of 8.2% through a combination of listed debentures, first-time commercial paper, and bank loans last fiscal.

Embassy REIT has a development pipeline of 6.1 million sq ft in Bengaluru at a yield of 20%. Of this, 4.7 million sq ft will be delivered over the next 24 months. The company's net debt stood at Rs 16,270 crore.