Nexus Select Trust reported an 8% YoY increase in net operating income for Q1 FY25, reaching INR 412.7 crore. Revenue from operations rose 6% to INR 553.8 crore, driven by rental-escalations and increased retail occupancy. Tenant sales hit INR 3000 crore, with malls' occupancy at 97.4%. The REIT signed term-sheets for two acquisitions totaling 8 lakh square-feet and plans to acquire five more assets, aiming to double its retail NOI by FY29. The board approved raising INR 1700 crore through debt-securities. A distribution of INR 325.3 crore was declared, with a record-date of August 7, 2024.
Nexus Select Trust, a leading retail REIT in India, reported an 8% year-on-year increase in net operating income (NOI) for the first quarter of FY25, reaching INR 412.7 crore. This growth was bolstered by a 6% rise in revenue from operations, amounting to INR 553.8 crore. Key drivers included minimum guaranteed rental escalations and increased trading occupancy in its retail portfolio.
During the June quarter, Nexus Select Trust leased 2.3 lakh square feet across 192 deals, with 1.8 lakh square feet being released at an 18% spread. The occupancy rate in its malls increased by 70 basis points to 97.4%. Despite modest consumption growth of 3% due to heatwave conditions and general elections in April and May, tenant sales reached INR 3000 crore, with notable improvements in footfall and growth in June. The retail segment achieved an NOI of INR 1700 crore.
The REIT announced the signing of term sheets for two new acquisitions totaling 8 lakh square feet of retail assets. Additionally, it is progressing with the acquisition of three assets in Hyderabad. In line with its fiscal year projections, Nexus Select Trust declared a total payout of INR 325.3 crore, equivalent to INR 2.147 per unit.
Dalip Sehgal, Executive Director and CEO, emphasised the company's commitment to capital spending and employment generation. He expects a robust recovery in consumption starting in the second half of FY25, supported by proposed tax amendments in Budget 2024. Sehgal outlined the REIT's strategy to double its retail portfolio over the next five years. The acquisitions, funded by debt, are expected to close in the coming months. The board approved raising up to INR 1700 crore through debt securities, including INR 500 crore via commercial papers and INR 1200 crore through non-convertible debentures.
Nexus Select Trust maintains a strong balance sheet with a low loan-to-value (LTV) ratio of 14%, providing a USD 1 billion headroom for future acquisitions. The REIT aims to acquire 15 lakh square feet or 2-3 malls annually, with a goal to double its retail NOI by FY29. Currently, the REIT owns and operates 17 malls across India, covering a total leasable area of 10 million square feet. Its portfolio also includes two hotel assets and three office assets.
In its latest regulatory filing, Nexus Select Trust highlighted its achievement of a retail NOI of INR 371.9 crore for Q1 FY25, marking an 8% increase from the previous year. It reiterated its strategy to expand its retail portfolio through targeted acquisitions, with five additional assets under consideration. The distribution for Q1 FY25, set at INR 2.147 per unit, will be paid by August 14, 2024.
Nexus Select Trust's portfolio encompasses 17 shopping malls with a gross leasable area of 9.9 million square feet across 14 Indian cities, alongside two hotels and three office assets. The retail real estate segment hosts over 1,000 domestic and international brands across approximately 3,000 stores.
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