India: Blackstone-backed Embassy REIT sees slight drop in rent collections in April

With the covid-19 disrupting economic activity and cash flows for businesses, American private equity firm Blackstone-backed Embassy Office Parks REIT, India’s first listed real estate investment trust, on Tuesday reported that it has received commitments for 95% of rent due for the month of April.

The slight drop in rent collection could be attributed to retail and food court rentals, which have been impacted with most companies implementing work from home for their employees.

In the wake of covid-19 outbreak and ongoing lockdown restrictions, the Bengaluru-based office developer has also halted all construction activity and hotel operations to comply with government directives during the lockdown.

“Embassy REIT has received commitments for 95% rent in the month of April 2020. This is in line, if not above, the global rental collections in commercial real estate. Embassy REIT has already collected c. 90% rent as of date in May 2020,” said said Embassy REIT chief executive Michael Holland.

“Embassy REIT has distributed 18,821 million in its first full year since listing. This is much more than any Nifty Realty (which consists of 10 listed Indian Real estate stock) which has delivered INR 11, 909 million, as of March 31, 2020,” added Holland.

“While the covid-19 pandemic has resulted in an uncertain near-term outlook for many businesses worldwide, we are uniquely positioned to weather this pandemic-induced storm with our best-in-class office portfolio and strong balance sheet,” said Michael Holland, chief executive officer at Embassy REIT.

“While demand is likely to moderate considerably through 2020, we believe that in this environment, Grade-A supply will reduce considerably over the medium term, consolidation in the office market will continue and high-quality institutional landlords, such as Embassy REIT, will gain market share,” he added.

As of the quarter ended March 31, the board of directors at Embassy Office Parks Management Services Pvt. Ltd., which manages the Embassy REIT, announced a distribution of 531.7 crore or 6.89 per unit to investors of the REIT. This takes the total distribution for fiscal 2020 to 1,882.1 crore or 24.39 per unit.

“We are very pleased with our strong business performance in fiscal 2019-20. Since Embassy REIT listed in April 2019, we have delivered a total return of 25%. Our fourth quarter income and distribution payout once again illustrate the stability and resilience of Embassy REIT delivering cash flows that are backed by the covenants of our 160+ largely multinational occupier base,” said Holland.

This article was first published on livemint.com.

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.