Embassy Office Parks REIT has received a right of first offer (ROFO) invitation from Embassy Property Developments for the potential sale of 6.2 million sq ft of completed office premises and 2.5 million sq ft of under-construction area in Embassy TechVillage in Bengaluru, the company said in a statement.
This ROFO notice has been issued under the framework of the pre-existing deed of right of first offer between Embassy REIT and the Embassy sponsor.
Embassy REIT will evaluate this offer but said that "there can be no assurance that the Embassy REIT will enter into any definitive arrangements for the proposed acquisition".
Embassy Office Parks has also reported a net profit of Rs 232.23 crore on a total income of Rs 538.1 crore for the second quarter of 2019-20.
Embassy Office Parks REIT, a joint venture between global investment firm Blackstone and realty firm Embassy Group, had raised Rs 4,750 crore in April this year through the launch of India's first Real Estate Investment Trust (REIT).
The board of directors of Embassy Office Parks Management Services, which is manager to the Embassy REIT, has declared a dividend of Rs 463 crore or Rs 6 per unit for the quarter ended September, a company statement said.
With this, cumulative distribution in the first half of this financial year stood at Rs 879.7 crore or Rs 11.4 per unit.
Revenue from operations for the second quarter of the financial year 2020 grew year-on-year by 15 percent to Rs 520 crore. Net Operating Income for the second quarter of 2020 grew year-on-year by 16 percent to Rs. 438 crore, the statement said.
Embassy REIT's CEO Michael Holland said the company has reported another strong quarter of performance and distributions to unit holders.
"Companies all around the world continue to look for highly educated, highly-skilled and technologically oriented employees at a reasonable cost and this continues to drive the consistent demand for Indian office and for our portfolio. We now turn our focus to continue this solid performance in the second half of the financial year," he said.
The portfolio occupancy increased to 94.7 per cent as on September 30, 2019, an increase of 100 basis points year-on-year.
New leasing during the second quarter of the financial year 2020 was 595k sf with a strong pipeline of over 500k sf. The cumulative new leasing for the first half of the financial year 2020 stood at 1.2 msf with a 67 percent mark-to-market spread on 0.9msf re-leases year-to-do, the statement said.
Near-term office development projects totaling 1.4 msf are tracking two quarters ahead of targeted delivery with 23 percent already pre-let and additional 400k sf pipeline, it said.
"Our robust leasing activity reflects the scale and quality of our business and the continued strong market fundamentals. Our development program is progressing ahead of schedule and we are well capitalized to fund future inorganic growth opportunities," said Vikaash Khdloya, Deputy Chief Executive Officer and Chief Operating Officer of Embassy REIT.