Embassy Reit's Q4 FY25 NOI grows 17% amid robust leasing, rent escalations

Bengaluru-based Embassy Office Parks REIT (Reit) reported 17 per cent year-on-year (Y-o-Y) growth in its net operating income (NOI), reaching ₹892.3 crore in the fourth quarter of the financial year 2024–25 (Q4 FY25).
This surge was fuelled by strong office demand within the Reit's key gateway markets, coupled with healthy leasing activity and rent escalations.
Adding to the positive results, Embassy Reit declared Q4 FY25 distributions of ₹538 crore, translating to ₹5.68 per unit, marking an 8 per cent Y-o-Y increase. This strong quarterly performance contributed to a total distribution for FY25 of ₹2,181 crore (₹23.01 per unit), exceeding the Reit's mid-point guidance by 1.1 per cent. Notably, since its listing in 2019, Embassy Reit's cumulative distributions have now surpassed ₹12,000 crore. The Reit's Ebitda for the reported quarter also saw an 11 per cent Y-o-Y increase, reaching ₹843 crore.
Looking at the full financial year, Embassy Reit achieved a 10 per cent Y-o-Y growth in NOI, amounting to ₹3,283 crore. The Reit's portfolio maintained a strong occupancy by value of 91 per cent across its key markets of Bengaluru, Mumbai and Chennai during FY25.
Ritwik Bhattacharjee, chief executive officer of Embassy Reit, commented on the results, stating, 'In FY25, we leased 6.6 million square feet (msf), delivered 2.5 msf of new development, and acquired a 5.0 msf high-quality asset. Notably, we increased distributions by 8 per cent and are pleased to guide to double-digit distribution growth in FY26. Our business is in excellent shape, and our world-class office portfolio continues to see strong demand from leading companies across the globe.'
A significant driver of leasing in FY25 was the strong activity from global capability centres (GCCs), which accounted for 61 per cent of the total leased area. The Reit also made strides in its development pipeline, delivering 2.5 msf of new developments in Bengaluru during FY25 and currently holds a pipeline of 6.1 msf across Bengaluru and Chennai, targeting an 18 per cent yield on cost.
Furthermore, Embassy Reit strategically acquired a 5 msf premium business park in Chennai and is actively pursuing further inorganic growth opportunities, including rights of first offer (ROFO) assets from its Embassy sponsor and select third-party acquisitions. The company also successfully refinanced ₹6,300 crore of debt at an average rate of 7.98 per cent.
Providing guidance for the upcoming financial year, Bhattacharjee acknowledged the prevailing socio-economic concerns but expressed confidence in the continued demand driven by GCCs. He highlighted the Reit's focus on execution, cost optimisation and achieving targets for the coming year.
Embassy Reit has projected its FY26 distributions to be in the range of ₹24.50 to ₹26 per unit, indicating a 10 per cent Y-o-Y growth at the midpoint. The Reit also anticipates occupancy by value to reach between 93 and 94 per cent and forecasts NOI to be between ₹35.9 billion and ₹38.1 billion, representing a 13 per cent growth.

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