Embassy Office Parks REIT (Embassy REIT) reported a strong performance for the first quarter ended June 30, 2026, driven by robust leasing activity, higher revenue and net operating income (NOI), and increased distributions to unitholders.
During the quarter, the company leased 1.3 million square feet (msf) across 17 transactions, with Global Capability Centres (GCCs) accounting for 81% of the total leasing demand. AI-related companies contributed 21% of new leasing, reflecting growing demand from technology-driven businesses.
Embassy REIT reported 17% year-on-year (YoY) growth in revenue from operations to Rs 1,241 crore, while NOI increased 17% YoY to Rs 1,020 crore.
The Board of Directors of Embassy Office Parks Management Services Private Limited, the manager of Embassy REIT, declared a distribution of Rs 598 crore, or Rs 6.31 per unit, for Q1 FY27, marking a 9% YoY increase. Embassy REIT has set August 4, 2026, as the record date for the distribution and will make the payout on or before August 11, 2026.
Commenting on the results, Amit Shetty, Chief Executive Officer of Embassy REIT, said, “We are delighted to report a strong start to FY2027, with revenue and NOI growing 17% YoY and 1.3 msf of leasing delivered across our portfolio. GCCs continued to anchor demand, accounting for 81% of quarterly leasing, while AI-related companies contributed 21% of new leasing. This reflects the growing depth and quality of India’s office market, with companies shaping the AI-driven economy choosing our campuses as platforms for growth. This strong momentum is also being complemented by greater recognition of REITs in India’s capital markets. Our recent inclusion in some of the newly launched domestic indices marks an important milestone in the evolution of REITs as a mainstream investment asset class in India. These benchmarks will support index-linked products, enhance market visibility and broaden investor participation.”
Of the total leasing during the quarter, 0.7 msf comprised new leases signed at an 11% re-leasing spread, while 0.6 msf consisted of renewals at 9% higher spreads. New entrants accounted for 86% of new leasing, with leases signed at an 8% average premium to prevailing market rents.
The REIT maintained a portfolio occupancy of 93% by value, with occupancy reaching 100% in Mumbai, 95% in Bengaluru, 93% in Noida, and 92% in Chennai.
On the financing front, Embassy REIT raised Rs 3,045 crore through commercial papers, non-convertible debentures (NCDs) and bank loans at a blended interest rate of 7.46% per annum.
The hospitality portfolio also delivered steady performance, with hotel NOI increasing 6% YoY, supported by a 100-basis-point rise in occupancy to 61% and 5% growth in average daily rate (ADR).
During the quarter, Embassy REIT launched the 211-key Hilton Garden Inn at Embassy TechVillage in Bengaluru, the first phase of its 529-key dual-branded Hilton development. The company expects to open the 318-key five-star Hilton hotel, featuring a 37,000 sq. ft. convention centre, later this year.
The company also announced that Four Seasons will conclude its management of the hotel at Embassy ONE, Bengaluru, effective February 28, 2027. Embassy REIT said it is evaluating new hospitality operators and expects to finalise a replacement partner in the near term.
Embassy REIT continues to advance its development pipeline of 6.2 msf, backed by a planned capital outlay of Rs 3,500 crore. Embassy REIT has already pre-leased around 60% of the space scheduled for delivery over the next two years.
The REIT’s 100 MW solar park generated 44 million units of electricity during the quarter and recorded a stabilised quarterly NOI of Rs 23 crore, supporting its sustainability initiatives and renewable energy commitments.
