Mindspace Business Parks REIT reported a robust first quarter for FY27, with a 15.2% rise in distribution per unit and renewed leasing activity, as it progresses with its strategic expansion plans and capitalises on market opportunities.
Mindspace Business Parks REIT posted a stronger first quarter for FY27, with distribution per unit rising 15.2% year on year to INR6.67 as net operating income climbed 27.8% to INR7,880 million. The trust said leasing activity remained brisk, with 0.9 million square feet of gross leasing and committed occupancy of 95.8% on a like-for-like basis. The result extends a run of steady operating gains for the portfolio, which the company has been building through both organic leasing and acquisitions.
The latest quarter also highlighted how much room remains for rental growth. Mindspace said its portfolio carried a mark-to-market opportunity, with in-place rents still well below rates being achieved on new deals in Hyderabad and other core markets. Chief executive Ramesh Nair said the trust has benefited from Hyderabad’s rise as a preferred global capability centre destination, while the company’s tenant mix remains anchored by multinational occupiers. According to the trust’s investor materials, the portfolio covered 44.4 million square feet across 17 office parks and 69 buildings as of March 31, 2026, with committed occupancy at 95.7% and a weighted average lease expiry of 7.2 years.
Growth is being supported by a sizeable pipeline. Mindspace said it has 9.5 million square feet under development, including pre-committed projects and new launches, and is widening its footprint in Chennai while also pushing into hotels and data centres. Nair said recent Chennai acquisitions still have significant vacancy to absorb, but he expects the available space to be taken up by the end of the current financial year. The trust also outlined fresh projects in Hyderabad, Navi Mumbai and Pune, with total development costs estimated at between INR1,000 crore and INR1,050 crore.
The quarter was not without pressure points. Occupancy dipped to 92.1% when recent acquisitions were included, and the company flagged a 6.5% rise in construction costs, along with the risk of higher funding costs if the macro and interest-rate backdrop worsens. Even so, management said a recent tax change allowing real estate investment trusts to shift to a new regime should reduce the burden on operating subsidiaries, with the tax rate on special purpose vehicles falling to 28.6% from 35%. Preeti Chheda, the chief financial officer, said the trust expects to keep distributing around 96% to 97% of net distributable cash flow, while retaining some cash for working capital and structural matters tied to an acquisition vehicle.
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