Knowledge Realty Trust (NSE: KRT / BSE: 544481) has reported a strong operational and financial performance for the quarter and half year ended September 30, 2025 — its first results after listing on the stock exchanges in August.

Leasing and Occupancy Trends

During the first half of FY26, the REIT achieved gross leasing of 1.8 million sq. ft., including 1.2 million sq. ft. of new leases and 0.6 million sq. ft. of renewals, at an average spread of 29%.

Portfolio occupancy increased 340 basis points year-on-year to 92%, supported by robust demand in its key markets — Hyderabad (99%), Mumbai (88%), and Bengaluru (88%). Global Capability Centres (GCCs) and domestic firms accounted for nearly 70% of total leasing activity.

Rental escalations were achieved on over 90% of leases, contributing to steady embedded growth across the portfolio.

Financial Performance

Net Operating Income (NOI) rose 20% year-on-year to ₹19,544 million for H1 FY26, with NOI margins at 89%, among the highest in the sector.
Revenue for Q2 FY26 stood at ₹11,238 million, while NOI for the quarter was ₹9,881 million.

The REIT raised ₹16,000 million through AAA-rated listed Non-Convertible Debentures (NCDs) at a 7.2% coupon, and achieved an overall reduction in interest cost to 7.4%, representing 120 basis points in savings.
Leverage remains conservative, with a loan-to-value (LTV) ratio of 18%.

Distribution and Guidance

The Board has declared the first post-listing distribution of ₹6,900 million, translating to ₹1.56 per unit for unitholders.

Shirish Godbole, CEO of Knowledge Realty Trust, said the REIT’s first results after listing reflect “strong leasing momentum and healthy operational metrics.” He added that the focus remains on delivering “sustainable growth and long-term value” to investors.

Quaiser Parvez, COO, noted that occupancy gains and consistent rental escalations highlight the portfolio’s “resilience and demand visibility across core markets.”

IPO and Capital Structure

The REIT’s IPO in August 2025 was subscribed 12 times, with strong participation from domestic insurance and pension funds.
The issue raised ₹62 billion (₹14 billion pre-IPO and ₹48 billion through the IPO), which was primarily used to repay ₹60 billion of debt, reducing LTV from 31% to 18%.

Investor Call and Materials

Knowledge Realty Trust has released its Q2 FY26 earnings presentation and related materials on its Investor Relations website www.knowledgerealtytrust.com.
A conference call with investors will be held on Monday, November 10, 2025, at 4:00 PM IST, and a replay will be available online.

Also Read: Data Benchmarking Institutions Launched to Empower Indian REIT Investors

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The Asia Pacific office market has shown a robust recovery, with demand surging 10.7% year-on-year (YoY) in Q3 2024, according to the latest Colliers data. The report highlights a significant increase in leasing activity across the region, with demand reaching 2.2 million square meters (23.7 million square feet) in the third quarter, signaling a positive outlook for 2025.

The growth was particularly strong in key markets such as India, New Zealand, and Singapore, where annual leasing activity exceeded 30%. India continued to dominate the region, accounting for over 70% of total demand in Q3 2024, with demand primarily driven by Bengaluru and Hyderabad. India alone saw leasing activity of 1.61 million square meters (17.3 million square feet), far outpacing other markets like China, which contributed 17% of the region’s total demand.

As a result of this surge in demand, average rental rates for Grade A office spaces in major Indian cities rose by up to 10% annually in Q3 2024. This uptick follows a significant recovery phase in India’s office market, which is now poised for expansion. Experts expect rental growth to continue across the country’s top cities, aligning with trends seen in markets like Australia, Japan, and New Zealand.

“The Indian office market is entering a new phase of growth, with increasing demand for premium, ESG-aligned office spaces,” said Arpit Mehrotra, Managing Director of Office Services at Colliers India. “Occupiers’ appetite for best-in-class facilities and green-certified buildings is driving leasing activity, and we expect to see further rental firming as developers integrate sustainable features into new developments.”

The report also notes that demand for high-quality office spaces is a key driver of growth across the region, as businesses prioritize productivity, sustainability, and adaptability in their work environments. This trend, known as the “flight to quality,” is particularly noticeable in India, where premium office spaces are seeing the most significant uptake.

“With the region’s economic outlook remaining positive, office markets are expected to stay resilient, with a strong focus on sustainable, high-quality workspaces,” said Vimal Nadar, Senior Director & Head of Research at Colliers India. “India’s commercial real estate market, in particular, is set to continue its upward trajectory, with a projected uptake of 5-6 million square meters (54-64 million square feet) of Grade A office space in 2024.”

As supply catches up with demand, significant project completions in major APAC markets are expected to fuel further growth in the coming quarters. While rental growth is anticipated to remain stable across the region, the supply-demand balance will play a crucial role in shaping future market conditions.

Mike Davis, Colliers’ Managing Director of Occupier Services in APAC, concluded: “The office market in Asia Pacific is primed for continued growth, driven by the evolving needs of occupiers who prioritize flexibility, sustainability, and innovation in their workspaces.”

The data suggests a promising future for the Asia Pacific office market, with India leading the way as a key player in the region’s commercial real estate landscape.

Also Read: Metro Group Unveils ‘The Presidential’ in Thane with India’s First Live Construction Tracker

The post India Leads Asia Pacific Office Market with 70% of Demand in Q3 2024, Driven by Flight to Quality appeared first on Square Feat India.

Key Factors Driving the Demand

1. Expansion of Tech Companies:

• Increased Hiring and Growth: Major tech giants and startups alike are expanding their operations in Bengaluru, leading to increased hiring and a need for larger office spaces. Companies such as Infosys, Wipro, and numerous IT startups are scaling up their facilities to accommodate their growing teams and project requirements.
• Global Presence: Many international tech firms are setting up or enlarging their offices in Bengaluru due to its status as a key tech hub. This global presence further drives demand for premium office space.

1. Leasing Activity in Office Spaces:

• High Occupancy Rates: The demand for office spaces has led to high occupancy rates in business districts such as Whitefield, Electronic City, and Outer Ring Road. Companies are increasingly seeking well-located office spaces that offer modern amenities and infrastructure.
• Long-Term Leases: There is a noticeable trend towards long-term leasing agreements as companies look to secure stable, long-term office spaces in strategic locations to support their growth.

1. Development of Business Parks:

• New Projects and Expansions: Developers are responding to the growing demand by launching new business parks and expanding existing ones. These developments are designed to cater to the needs of tech companies, offering features like flexible office layouts, state-of-the-art facilities, and integrated services.
• Focus on Infrastructure: Modern business parks in Bengaluru are being equipped with advanced infrastructure, including high-speed internet, energy-efficient systems, and extensive support services, to attract and retain tech tenants.

1. Tech-Driven Real Estate Trends:

• Flexible Workspaces: The rise of hybrid work models and flexible workspaces has influenced the commercial real estate market. Companies are seeking office spaces that can accommodate both traditional and flexible working arrangements, leading to increased interest in co-working spaces and adaptive office designs.
• Tech Integration: The integration of technology into office spaces, such as smart building systems and enhanced security features, is becoming a key consideration for tenants and developers alike.

1. Economic and Investment Factors:

• Attractive Investment Destination: Bengaluru’s robust tech ecosystem makes it an attractive destination for real estate investors. The city’s real estate market is seen as a stable and lucrative investment opportunity due to its strong economic fundamentals and ongoing growth in the tech sector.
• High Rental Yields: The surge in demand for commercial real estate has led to increased rental yields, making it a profitable sector for investors and developers.

Impact on the Market

• Rising Property Values: The heightened demand for office spaces and business parks has driven up property values in key commercial areas. This increase reflects both the high demand and the premium placed on well-located, high-quality office spaces.
• Development Opportunities: Developers are actively seeking new opportunities and land acquisitions to meet the growing demand. This has led to a surge in new construction projects and the redevelopment of older properties.
• Shifts in Market Dynamics: The tech boom has also led to shifts in market dynamics, with increased emphasis on tech-enabled features and amenities in commercial properties.

Looking Ahead

As Bengaluru continues to solidify its position as a global tech hub, the demand for commercial real estate is expected to remain strong. The city’s real estate market will likely continue evolving, driven by ongoing tech sector growth, changes in work trends, and continued investment in infrastructure and business parks. Both investors and developers are poised to benefit from the sustained expansion of Bengaluru’s commercial real estate sector.

Also Read: Surge in Green Office Spaces: Bengaluru and Mumbai Lead as Demand Soars in H1 2024

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