Mindspace Business Parks REIT (MINDSPACE) Q3 24/25 earnings summary

Executive summary

• Achieved strong operational and financial growth in Q3 FY2025, with gross leasing of 1.7 million sq ft and 9M gross leasing at 4.9 million sq ft, the highest in a year, and robust demand for grade A office spaces.

• NOI grew 8.3% year-on-year, with distributions up 10.9% YoY, and stable occupancy at 91.5%; 45% of new leases were to global capability centers.

• Several large pre-leases closed, including full pre-leasing of a 1 million sq ft building in Pune to a major MNC GCC, and pre-leasing in Kharadi.

• Received occupancy certificate for second data center in Airoli ahead of schedule; High Street Retail in Airoli East set to become operational next quarter.

• Portfolio expansion through proposed Hyderabad ROFO asset acquisition, approval for new assets in Hyderabad, and evaluation of further third-party opportunities.

Financial highlights

• Revenue from operations for Q3 FY2025 grew 7.6% year-on-year to INR 6,419 million; NOI for the quarter was INR 5,218 million, up 8.3% YoY.

• Distribution per unit for Q3 FY2025 at INR 5.32, totaling INR 3,154.86 million; YTD distributions at INR 9,283.22 million.

• Loan-to-value remains low at 22.6%, with cost of debt at 8.07%-8.1% due to refinancing.

• Raised INR 5,000 million NCD at 7.67% in Q3 FY25; 53.3% of borrowings are fixed cost debt securities.

• Total assets as of December 31, 2024, stood at INR 248,536.72 million; net worth at INR 144,309.79 million.

Outlook and guidance

• Expecting occupancy to reach 92.5%-92.89% by March 31, 2025, with strong leasing pipeline and ~70% re-leasing visibility for 2.7 million sq ft expiries in FY25.

• Expiry for next two years projected at 1.5 million sq ft (FY2026) and 1.3 million sq ft (FY2027), below historical averages.

• Board continues to focus on portfolio expansion in Hyderabad and other key markets.

• Rental escalations expected at 5%-6% annually, with double-digit growth seen as unlikely.

• Distribution policy remains to declare and distribute at least 90% of NDCF as per SEBI guidelines.