Embassy REIT Announces FY 2021 Results, Delivers Resilient Performance
Embassy Office Parks REIT, India’s first listed REIT and the largest in Asia by area, reported results on April 29th for the fourth quarter and full year ended March 31, 2021.
Michael Holland, Chief Executive Officer, Embassy REIT said, “Despite the significant challenges caused by the Covid-19 pandemic, Embassy REIT has again performed strongly and delivered on its financial guidance. We continue to provide safe work environments for our occupiers and we are working with local authorities to support the response to the second wave of the pandemic, including initiating vaccination programmes at our parks. Despite second wave headwinds, our global occupiers continue to report strong earnings and hiring growth which we believe will translate into demand for quality offices in due course. With our leading presence in India’s highest absorption markets, our low leverage levels and our access to capital markets, we are well positioned to capitalize on the fundamental global demand for Indian office space that will long outlast this pandemic.”
The Board of Directors of Embassy Office Parks Management Services Private Limited (‘EOPMSPL’), Manager to Embassy REIT, at its Board Meeting held earlier today, declared a distribution of ₹5,308 million or ₹5.6 per unit for 4Q FY2021. The cumulative distribution for FY2021 totals ₹18,364 million or ₹21.48 per unit, which is on target with the guidance issued earlier by management. The record date for the 4Q FY2021 distribution is May 7, 2021 and the distribution will be paid on or before May 14, 2021.
Financial Highlights – Full Year FY2021
- Net Operating Income (‘NOI’) grew year-on-year by 12%, with operating margins of 86% • Simplified the holding structure of Embassy Manyata, thereby increasing the tax-free component of distributions to 78% for 4Q FY2021
- Raised ₹52 billion debt at attractive 6.9% coupon, refinanced ₹32.8 billion leading to 336 bps interest savings • Fortress balance sheet with liquidity of ₹15.5 billion and low leverage of 22%; ample headroom to finance on campus development and new acquisitions
Business Highlights – Full Year FY2021
- Stable occupancy of 88.9% with strong rent collections at 99.8% on 32.3 msf operating portfolio • Achieved rent increases of 13% on 8.4 msf across 90+ leases
- Leased 1.2 msf across 40+ deals, achieved 15% re-leasing / renewal spread
- Achieved top-out of 1.1 msf JP Morgan campus in Mar’21, on track for Sep’21 delivery • Continued construction on additional 4.6 msf new build, targeted completion in 2 to 3 years
- Our parks remain open with focus on ensuring safe workspaces and business continuity for our occupiers
- Set up vaccine centers at Embassy Manyata and Embassy TechVillage with vaccination roll out for 4,900 frontline staff underway
- Subscribed to WELL Portfolio™ program to create healthier office buildings and thriving business ecosystems
- Built a second government school in February 2021 in partnership with ANZ, school to benefit 1,200 students