April 25, 2024: Embassy Office Parks REIT recorded its highest-ever leasing of 8.1 million square foot (msf) across 99 deals in the financial year 2024 (FY2024), including pre-leasing of 2.4 msf across four large deals with leading multinationals. The company achieved occupancy guidance of 85% at year-end, as per its official release on results for the fourth quarter and full year ending March 31, 2024.
Aravind Maiya, chief executive officer of Embassy REIT, said, “We leased a record 8.1 msf to leading corporates, majority of which were GCCs, we delivered 2.2 msf of new office development and we recently announced our intent to acquire, demonstrating our commitment to driving growth for all our stakeholders. In our fifth year as India’s first listed REIT, we continue to see our business grow from strength to strength, and we are excited to announce our entry into a new market with our proposed acquisition of Embassy Splendid TechZone in Chennai. Given the sustained robust performance and our positive outlook on Indian office, we’re pleased to provide guidance for FY2025, which includes 5.4 msf of total leasing and distributions guidance in the range of Rs 22.40 to Rs 23.10 per unit.”
The board of directors of Embassy Office Parks Management Services (EOPMSPL), manager to Embassy REIT, at its board meeting, declared a distribution of Rs 495 crore or Rs 5.22 per unit for Q4 FY2024. With this, the cumulative distribution for FY2024 totals Rs 2,022 crore or Rs 21.33 per unit. The record date for the Q4 FY2024 distribution is May 06, 2024 and the distribution will be paid on or before May 10, 2024.
According to the release, Global Capability Centres (GCCs) account for more than 65% of the annual leasing activity. Bangalore occupancy stood at 91% while Mumbai recorded 99%. Both markets represent around 86% of total assets by value.
The company witnessed revenue growth from operations and net operating income by 8% YoY, recording Rs 3,685 crore and Rs 2,982 crore, respectively. It delivered distributions of Rs 2,022 crore or Rs 21.33 per unit for FY2024; cumulative distributions of around Rs 9,900 crore since listing. The company 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. It recorded a debt cost at 7.8% and dual AAA/Stable credit ratings.
The company announced the proposed acquisition of Embassy Splendid TechZone (‘ESTZ’) in Chennai for an enterprise value of up to Rs 1,269 crore and an institutional placement of up to Rs 3,000 crore, subject to unitholder approval and other conditions. The release mentioned the company’s development pipeline of 6.1 msf in Bangalore at attractive yields of around 20%. It said the hotel portfolio recorded YoY 6% increase in occupancy, 14% ADR growth and an annual EBITDA of Rs 184 crore.
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