India’s four listed Real Estate Investment Trusts (REITs) — Mindspace Business Parks REIT, Brookfield India REIT, Embassy Office Parks REIT, and Nexus Select Trust — opened FY26 with a quarter that combined steady income payouts, strong leasing, and high occupancies.
Between April and June 2025, the REITs distributed a total of INR 1,560.6 crore to unitholders and leased over 14.95 million sq. ft. of space, underscoring the resilience of Grade-A commercial and retail real estate despite a backdrop of elevated interest rates and selective corporate expansion.
Macro & Sector Context
India’s REIT market — with an asset base of more than INR 1.5 lakh crore — has evolved from a niche income product into a mainstream investment option since the first listing in 2019.
REITs Q1 FY26 performance unfolded against three defining trends:
- Sticky interest rates – RBI’s repo at 6.50% kept refinancing costs elevated.
- Global Capability Centers (GCCs), BFSI, and manufacturing majors drove incremental office demand.
- Retail outperformance – footfall and sales growth in organised malls sustained momentum for the lone retail REIT.
REITs Q1 FY26 distribution proved that, despite mixed global office demand signals, India’s REIT portfolios remain largely insulated through diversified tenant bases, long WALEs, and active asset management.
Combined REITs Q1 FY26 Distribution, Performance
| Metric | Mindspace | Brookfield | Embassy | Nexus | Sector Total |
|---|---|---|---|---|---|
| Revenue from Operation | 752.3 | 641.6 | 1,060.0 | 613.6 | 3,063.9 |
| NOI | 616.4 | 498.6 | 872.0 | 460.2 | 2,407.4 |
| NDCF | 358.5 | 319.1 | 551.0 | 337.8 | 1,559.9 |
| Distribution/Unit (INR) | 5.79 | 5.25 | 5.80 | 2.23 | — |
| Total Distribution | 352.7 | 319.1 | 550.0 | 337.8 | 1,560.6 |
| Committed Occupancy (%) | 91.9 | 89.0 | 88.0 | 97.2 | 90.25% |
| Gross Leasing in Qtr (msf) | 1.70 | 0.65 | 2.00 | 10.6 | 14.95 |
Distribution Yields (Annualised, July 31, 2025 CMP)
- Mindspace – ~7.6%
- Brookfield – ~7.4%
- Embassy – ~7.8%
- Nexus – ~6.0%
Even with unit price appreciation for some REITs in late FY25, yields remain comfortably above 10-year G-Sec levels, preserving the income appeal for long-term investors.
Operational Highlights
Mindspace Business Parks REIT
- Distributed INR 5.79 per unit (Interest INR 0.10, Loan Repayment INR 2.47, Dividend INR 3.19).
- Gross leasing of 1.7 msf, 65% new deals and 35% renewals.
- Committed occupancy at 91.9% (ex-Pocharam 93.7%), WALE ~7.6 years.
- Development pipeline ~3 msf in Navi Mumbai and Pune.
Brookfield India REIT
- Brookfield India REIT distributed INR 5.25 per unit (Interest INR 1.89, Loan Repayment INR 2.71, Dividend INR 0.63, FD Interest INR 0.02).
- 0.65 msf gross leasing with re-leasing spreads of ~22%.
- Committed occupancy at 89%; WALE 6.8 years.
- LTV 25%; average interest cost 8.1%, targeted reduction in Q2.
Embassy Office Parks REIT
- Distributed INR 5.80 per unit, the highest absolute payout at INR 550 crore.
- NOI margin strong at ~86%; revenue INR 1,060 crore.
- Gross leasing of 2.0 msf, driven by pre-commitments and renewals.
- 4.2 msf under construction in Bengaluru and Chennai.
Nexus Select Trust
- Distributed INR 2.23 per unit; retail NOI at INR 420 crore.
- Committed occupancy at 97.2%, the highest in the sector.
- Tenant sales growth of 14% YoY; leasing of 0.10 msf in fashion, F&B.
- Exploring acquisitions in Tier-I cities.
Sector Trends & Comparative Insights
- Payout Stability: All REITs maintained distributions in line with prior quarters despite high interest rates.
- Leasing Leaders: Embassy led in volume (2.0 msf), Mindspace followed (1.7 msf).
- Occupancy Strength: Nexus leads with 94.3%; sector average above 90%.
- Diversification: Office REITs anchored by GCC/IT tenants; retail REIT driven by consumption tailwinds.
Risks & Opportunities
Risks:
- Potential delay in interest rate cuts could keep debt costs elevated.
- Prolonged IT sector hiring slowdown may impact office absorption.
- Global slowdown risk for multinational occupiers.
Opportunities:
- GCC expansion in India expected to continue at double-digit CAGR.
- Retail consumption resilience backed by rising disposable incomes.
- Regulatory relaxations for FPIs in REITs could broaden investor base.
Investor Takeaways
- Income resilience remains the core strength — INR 1,560 crore distributed in one quarter alone.
- Occupancy stability and long WALEs provide visibility on future cash flows.
- Yields remain attractive relative to debt instruments; NAV discounts in some REITs present value entry points.
Conclusion
REITs Q1 FY26 distribution reaffirms the Indian REIT sector’s ability to blend predictable income with growth. High leasing volumes, near-stable occupancies, and steady quarterly payouts offer comfort to yield-focused investors, while measured development pipelines promise incremental NAV growth.
The coming quarters will hinge on corporate expansion decisions, consumer spending trends, and the trajectory of interest rates — but for now, India’s REIT story continues to hold steady.
Note: Total distribution is sum of individual REIT payouts for Q1 FY26; all figures from company filings and investor presentations