Embassy Office Parks REIT Reports Strong Q3 FY2026 Performance, Driven by Leasing Momentum and Strategic Growth
Embassy Office Parks REIT (NSE: EMBASSY / BSE: 542602), India’s first publicly listed Real Estate Investment Trust and Asia’s largest office REIT by gross leasable area, announced its financial and operating results for the third quarter ended December 31, 2025. The quarter reflected continued strength across leasing, revenues, asset quality, and capital management, reinforcing Embassy REIT’s leadership position in India’s commercial real estate market.
The REIT delivered its highest-ever quarterly revenue and Net Operating Income (NOI), supported by strong demand from global occupiers, disciplined financial execution, and portfolio-led growth initiatives across key gateway cities.
Management Commentary: Focus on Quality Assets and Long-Term Value Creation
Commenting on the quarterly performance, Amit Shetty, Chief Executive Officer of Embassy REIT, highlighted the sustained operating momentum and strategic progress achieved during the quarter.
He stated that Q3 FY2026 marked another robust quarter, underpinned by healthy leasing activity, strong Global Capability Centre (GCC) demand across major office markets, and prudent financial management. Embassy REIT achieved 4.6 million square feet (msf) of leasing year-to-date, reflecting resilient occupier demand for high-quality office spaces.
The quarter also marked several milestones, including the announcement of the REIT’s first third-party acquisition, record revenue and NOI, and enhanced distributions to unitholders. The invitation to offer for Embassy Zenith, a prime office asset, demonstrates the REIT’s commitment to acquiring income-accretive, high-quality properties that strengthen its portfolio and deliver long-term value to investors.
Board Declares Q3 FY2026 Distribution of ₹613 Crores
The Board of Directors of Embassy Office Parks Management Services Private Limited (EOPMSPL), the Manager to Embassy REIT, convened earlier today and approved a quarterly distribution of ₹613 crores, translating to ₹6.47 per unit for Q3 FY2026.
- Record Date: February 11, 2026
- Distribution Payment Date: On or before February 18, 2026
The distribution reflects the REIT’s strong cash flow generation and commitment to delivering consistent and growing returns to unitholders.
Business Highlights: Strong Leasing and Portfolio Occupancy
Embassy REIT reported 1.1 msf of leasing activity during the quarter, spread across 22 transactions, demonstrating sustained demand for its office assets.
Key leasing highlights include:
- 0.8 msf of new leases executed at 17% re-leasing spreads, indicating strong rental growth
- Lease signings achieved at an average 5% premium to prevailing market rents
- Bengaluru contributed over two-thirds of total leasing, reaffirming its position as India’s leading office market
Chennai also emerged as a key growth engine, with strong interest from large global enterprises. The city now anchors 42% of Embassy REIT’s development pipeline, highlighting its growing importance in the REIT’s long-term strategy.
Overall portfolio occupancy stood at 94% by value, with three out of five operating cities reporting occupancy levels of 95% or higher, reflecting portfolio stability and tenant stickiness.
Financial Performance: Revenue and NOI Reach Record Highs
Embassy REIT delivered a strong financial performance during Q3 FY2026, supported by leasing momentum, rental growth, and operational efficiencies.
Key Financial Highlights
- Revenue from Operations increased by 17% year-on-year to ₹1,193 crores
- Net Operating Income (NOI) grew by 19% YoY to ₹985 crores, marking the highest-ever quarterly NOI
- Quarterly distributions rose by 10% YoY, underscoring earnings visibility and cash flow strength
The REIT continued to optimise its capital structure during the quarter. It raised ₹400 crores through commercial paper at an attractive effective interest rate of 6.44% per annum. Over the past nine months, Embassy REIT successfully reduced its in-place cost of debt by 61 basis points, bringing it down to 7.29%, further strengthening its balance sheet.
Hotel Segment Shows Steady Recovery
Embassy REIT’s hospitality portfolio delivered encouraging results during the quarter.
- Hotel segment NOI increased by 13% YoY
- Portfolio occupancy improved by 100 basis points to 60%
- Average Daily Rate (ADR) grew by 11%, reflecting improving demand and pricing power
The steady recovery in the hotel segment adds further diversification and income resilience to the REIT’s overall portfolio.
Development, Redevelopment, and Growth Initiatives
Embassy REIT continued to advance its development and value-enhancement strategy across key assets.
Development & Redevelopment Highlights
- Delivered 0.4 msf of new development at Embassy Splendid TechZone, Chennai, which is 100% leased to a global healthcare company
- Launched the third redevelopment project at Embassy Manyata, Bengaluru, spanning 0.8 msf and targeting a 23% yield on cost
- Proposed addition of a 116-key hotel at Embassy TechZone, Pune, aimed at strengthening the integrated business park ecosystem
Acquisitions and Capital Recycling
The quarter also marked progress in acquisitions and asset monetisation.
- Announced a third-party acquisition of a 0.3 msf marquee office asset at Embassy GolfLinks, Bengaluru, enhancing the REIT’s premium portfolio
- Completed a ₹530 crore divestment at Embassy Manyata, demonstrating active capital recycling and disciplined portfolio management
Additionally, the invitation to offer for Embassy Zenith, a 0.4 msf prime office asset in Bengaluru, aligns with Embassy REIT’s strategy of pursuing selective, income-accretive acquisitions.
Unitholder Returns and Growing Investor Base
Embassy REIT delivered approximately 25% total returns in calendar year 2025, reflecting strong operating performance and market confidence. The REIT also significantly expanded its investor base, with the number of unitholders increasing to over 125,000, compared to approximately 4,000 at the time of its IPO.
This growth highlights increasing investor participation and confidence in Embassy REIT’s long-term value proposition.
Investor Materials and Earnings Call Details
Embassy REIT has released a comprehensive set of investor materials related to its Q3 FY2026 performance, including:
- Unaudited standalone and consolidated financial results for the nine months ended December 31, 2025
- Earnings presentation covering Q3 FY2026 performance
- Supplemental operating and financial data book, aligned with global REIT reporting best practices
All materials are available in the Investors section of the Embassy REIT website.
The REIT will also host a quarterly earnings conference call on February 9, 2026, at 8:30 AM IST to discuss the results. A replay of the call will be made available on the company’s website following the event.
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