Embassy Reit, which recently acquired the property maintenance business of Embassy Manyata Business Park in Bengaluru and of Embassy TechZone in Pune from an Embassy Group affiliate is scouting for large scale office parks for acquisition.
The Blackstone-backed Reit is looking at an asset size of anywhere between 2 million square feet to 10 million square feet for acquisitions. It is eyeing large scale office portfolios, which not only have high quality buildings, but a whole ecosystem of gymnasiums, food courts and open spaces.
The key strategy is to acquire those assets which can attract best in class multinational technology occupiers and global active tenants who don’t mind paying high rentals.
“We have significant headroom to raise funds either through debt or equity markets for the right opportunity. Hence, we remain super positive as availability of capital will not be a problem for us,” said Mike Holland, CEO, Embassy Reit.
While the net operating income for the second quarter of FY21 grew 10 per cent year-on-year for the company at Rs 481 crore, rental collections for the quarter from office occupiers remained strong at 99.5 per cent, in-line with office rental collections of 99.7 per cent for Q1FY21. There were no rent waivers given to office occupiers. However, rebate was granted to food courts and ancillary retail tenants representing 1.4 per cent of annual rents, said the company. It signed 210,000 square feet leases during Q2 across 7 deals with an active lease pipeline of 265,000 square feet for the coming quarters.
“Embassy Reit continues to deliver amidst challenging conditions caused by the global pandemic. Our multinational technology occupiers and global captive tenants continue to see strong demand for their services as global businesses bring forward spend on digital transformation, cloud solutions and cybersecurity. We also remain focused on growth through multiple channels including accretive acquisitions,” said Holland