 "office sector, Global capacity center, office leasing, office spaces, Commercial real estate")
Knowledge Realty Trust on Monday reported a robust gross leasing of 1.8 million square feet (msf) in the first half of 2025-26 (H1FY26), including 1.2 msf of new leases and 0.6 msf of renewals at an average spread of 29 per cent.
The real estate investment trust (Reit), backed by Sattva Group and Blackstone, also achieved annual rental escalations on over 90 per cent of leases signed during H1.
Meanwhile, global capability centres (GCCs) and domestic firms drove its leasing accounting for 70 per cent of the activity.
Commenting on this trend, Quaiser Parvez, chief operating officer (COO) at Knowledge Realty Trust told Business Standard that GCCs have moved from cost arbitrage to capability arbitrage.
These centres are now coming to the country not just for lower operating costs but because of the capability depth that India has to provide.
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“Additionally, we are also seeing domestic companies having healthier balance sheets and a newfound preference for quality grade A space,” he added.
On the financial front, the Reit reported revenue of ₹2201.9 crore and net operating income of ₹1954.4 crore for the period, marking a 17 per cent and 20 per cent year-on-year (Y-o-Y) increase, respectively.
Shirish Godbole, chief executive officer (CEO), Knowledge Realty Trust, said it was due to increasing demand in high quality office assets, which it has been instrumental in, leading to portfolio occupancy improvement.
“All the key markets where we operate in such as Hyderabad, Bangalore and Mumbai are going through a genuinely healthy tightening phase in terms of supply. This comes at a time when there is a buoyant deepening demand coming through in all of these markets,” Quaiser said.
The portfolio occupancy improvement was led by Hyderabad at 99 per cent, Mumbai at 88 per cent and Bengaluru at 88 per cent.
“With a portfolio representing one of India’s finest Grade-A office ecosystems, we are well positioned to deliver sustainable growth and long-term value for our unitholders,” Quaiser said.
With a portfolio of 29 office assets totalling 46.4 msf as of September 30, 2025, Knowledge Realty Trust has 37.1 msf in completed area, 1.2 msf under construction area and 8 msf of future development across six cities in India.
Speaking on future acquisitions, Godbole said that while they have 1.2 msf under construction, which will get completed by the end of FY26, the trust is scouting for acquisition opportunities for inorganic growth.
Quaiser added that the trust also has 6.7 msf of right of first offer assets, which are under construction and may likely come up for discussions in the next two years.
“Our focus continues to be in the top seven markets of the country. But the way we review things, the focus will always be on the right city, right sub-market and asset quality,” Godbole said.
The Reit has raised ₹6,200 crore through its recent initial public issue (IPO), comprising ₹1,400 crore pre-IPO and ₹4,800 crore from the IPO itself. It has also declared its first distribution of ₹690 crore, equivalent to ₹1.56 per unit.
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