Knowledge Realty Trust NOI up 15%, declares record Rs 764 cr distribution in Q2

Knowledge Realty Trust posts strong Q2 FY27 performance, with higher income, record investor distributions, rising occupancy and robust leasing momentum across its Indian office portfolio.

The office REIT declared record distributions of Rs 764 crore for the second quarter of the ongoing financial year, translating into a distribution per unit (DPU) of Rs 1.72, up 11% from a year ago. Around 82% of the distribution is tax-efficient in the hands of unitholders, the REIT said in its earnings release.

The trust recorded gross leasing of 0.8 million sq ft during the quarter, including 0.2 million sq ft of pre-leasing, taking its cumulative leasing for the first half of the financial year to 2.2 million sq ft.

The REIT’s committed occupancy stood at 93% on an area basis and 94% on a value basis. The average spread on leasing during the quarter was 24%, while in-place rents increased 7% year-on-year to Rs 101 per sq ft per month.

“Our growth levers remain firmly in place - contracted escalations, sizeable mark-to-market potential, vacant area lease-up, economic occupancy convergence and an active development pipeline – while our loan to value ratio of 18% provides significant headroom as we evaluate multiple value-accretive opportunities across sponsor and third-party assets,” said Shirish Godbole, chief executive officer of Knowledge Realty Trust.

Expansions by existing tenants accounted for 54% of leasing during the quarter, while the trust achieved annual rental escalations across all leasing transactions. Its weighted average mark-to-market rental potential stands at 25% until financial year 2029-30.

The REIT’s Mumbai portfolio occupancy increased to 95%, rising 300 basis points sequentially and 600 basis points since March 2026, driven by demand from front-office occupiers. The trust achieved a 28% rental spread on 0.6 million sq ft of space re-leased or renewed in Mumbai since March 2026.

In Hyderabad, the trust has repriced around 0.6 million sq ft of space since its listing, achieving a 41% spread on gross rentals.

The NOI margin expanded to 90% in the September quarter from 88% in the corresponding period last year. The trust’s gross asset value stood at Rs 68,863.1 crore as of September 30, 2026, translating into a net asset value of Rs 127 per unit, up 7% year-on-year.

Co-sponsored by Sattva and Blackstone, Knowledge Realty Trust has a portfolio of 29 Grade A office assets aggregating 46.5 million sq ft across six Indian cities. The portfolio includes 37.3 million sq ft of completed area, 2.6 million sq ft under construction and 6.6 million sq ft of future development area. It houses more than 475 tenants.