Embassy REIT Q3 results: NOI rises 9.1% amid strong office demand

The REIT declared a distribution of Rs 559 crore, or Rs 5.90 per unit, for Q3 FY2025

Embassy real estate investment trust (Reit) reported a 9.1 per cent increase in its net operating income (NOI) for the third quarter of the financial year 2024-25 (Q3 FY25) on the back of strong office demand in the Reit’s gateway markets. The Reit’s NOI stood at Rs 829 crore, the highest ever in its history.

 

The Reit operates in markets including Bengaluru, Mumbai, Pune, Noida, and Chennai.

 

The Reit also declared a distribution of Rs 559 crore, or Rs 5.90 per unit, for the quarter, up 13 per cent year-on-year (YoY). As per the Securities and Exchange Board of India (Sebi), Reits are mandated to distribute at least 90 per cent of their taxable income.

 

The Reit’s earnings before interest, taxes, depreciation, and amortisation (Ebitda) for the quarter stood at Rs 787.8 crore, up 3 per cent YoY. However, the Ebitda margin declined to 77 per cent from 81 per cent in Q3 FY24.

 

Ritwik Bhattacharjee, chief executive officer of the Reit, said, "Embassy Reit’s portfolio remains the first port of call for GCCs and other leading companies in arguably the world’s most dynamic market for talent and innovation. CY2024 was a record year for absorption in India, and we are perfectly poised to capitalise on these leasing tailwinds in CY2025.”

 

As per Knight Frank, the top Indian cities witnessed historic office space transactions of 71.9 million square feet (msf), up 20.8 per cent YoY. The global capability centres (GCCs) accounted for 31 per cent of the total transactions.

 

Besides, the Reit has set an annual guidance of Rs 3,280 crore in terms of NOI and has achieved 73 per cent of it during the first nine months of FY25.

 

In Q3 FY25, the Reit leased 1.1 msf of space, with 70 per cent of it being leased to the GCCs. It has given a guidance of 6.5 msf for FY25 and has achieved 78.5 per cent of it. However, the guidance is significantly lower than the Reit’s actual leasing of 8.1 msf in FY24.

  As of December 2024, the Reit’s occupancy levels are around 87 per cent.