Embassy REIT posts 16% revenue rise and record ₹670 crore payout for Q2

Embassy Office Parks REIT, India's first listed real estate investment trust, reported revenue from operations of ₹1,303 crore for the quarter ended 30 September 2026, up 16% from a year earlier. The results were announced on 28 October 2026. Net operating income (NOI), the rental income left after property running costs, rose 15% to ₹1,069 crore.

The board of Embassy Office Parks Management Services Private Limited, the manager of the trust, declared a distribution of ₹670 crore, or ₹7.07 per unit. The company described it as its highest-ever quarterly payout, and it is up 9%. The record date is 31 October 2026, and payment will be made on or before 6 November 2026.

Leasing and rents

The trust leased 1.5 million square feet across 17 deals in the quarter. This comprised 0.9 million sq ft of new leasing, 0.1 million sq ft of renewals and 0.5 million sq ft of pre-leasing. Global capability centres, or GCCs, accounted for 85% of demand. New leases were signed at an average 9% premium to market rents.

The largest transaction was the full pre-lease of a 0.5 million sq ft building at Embassy TechVillage in Bengaluru to a global engineering company. The rent is 15% above current market rent. At Embassy Manyata, also in Bengaluru, 500,000 sq ft of new leasing was agreed at ₹117 per sq ft per month, against an assessed market rent of ₹107.

In Pune, the trust leased 0.2 million sq ft across three assets, about 25% of new leasing in the quarter. The company said occupancy in Pune improved by 300 basis points during the quarter. The trust also delivered a 0.6 million sq ft office block in Chennai, which is fully committed to a US-based GCC.

Amit Shetty, Chief Executive Officer of the trust, described the quarter as exceptional. He linked the TechVillage pre-lease to pricing, saying it showed the pricing power of the company's office campuses.

Valuation, hotels and pipeline

Gross asset value rose 16% year on year to about ₹74,000 crore. Net asset value rose 18% to ₹524.74 per unit. The company said the increase came from higher market rents, new building additions and favourable valuation. Occupancy stands at 93% by value. Bengaluru, Chennai and Noida are each at 94%, and Mumbai is fully occupied.

Hotel revenue rose 22% and average daily rates rose 10%. The Hilton Garden Inn at Embassy TechVillage, recently opened, reached operating cash break-even within its first quarter. The trust has a development pipeline of 5.6 million sq ft in Bengaluru and Chennai. For FY27, it has guided to NOI of ₹4,150 crore to ₹4,350 crore.

Bengaluru accounts for 75% of the trust's gross asset value. Across the portfolio, about 4.6 million sq ft of space is still vacant. Cushman & Wakefield's third-quarter 2026 data shows Bengaluru office leasing of 5.2 million sq ft, with GCCs making up 65% of demand and the Outer Ring Road taking 61% of leasing.

One figure needs a note. An earlier Q1 FY27 presentation summary listed Block 6 at Embassy TechVillage at 0.4 million sq ft. The Q2 results put it at 0.5 million sq ft. The delivery target of June 2027 is the same in both.

What investors will watch

Analysts tracking the trust point to three risks. Pune is still under-occupied. Debt maturities need to be managed. Hotel income is less steady than office income. The trust's Q2 results do not give a figure for funding costs, so that part of the picture is still open.

• 29 October 2026, 08:30 IST: investor conference call on the Q2 FY27 results.
• 31 October 2026: record date for the distribution.
• On or before 6 November 2026: distribution payment.
• June 2027: targeted delivery of Block 6 at Embassy TechVillage.
• June 2028: targeted completion of Embassy Business Hub Phase 2, which is 23% pre-leased.
• Later in FY27: expected launch of the remaining 318-key Hilton hotel.

The next test for the trust is whether Pune leasing can continue while it fills vacant space there, completes its development pipeline and keeps funding costs under control.