Knowledge Realty Trust says expansions supplied 54% of Q2 demand

Knowledge Realty Trust reported that existing-tenant expansions accounted for 54% of Q2 FY27 new leasing and pre-leasing by gross rents, while KRT achieved a 24% average leasing spread on 0.5 million square feet (msf). Gross leasing was 0.8 msf, including 0.2 msf of pre-leasing at Sattva Endeavour.

How did KRT's Q2 FY27 leasing perform?

KRT reported 0.8 msf of gross leasing in Q2 FY27, comprising 0.5 msf of new leasing, 0.1 msf of renewals and 0.2 msf of pre-leasing. The 24% average spread applied to 0.5 msf, while re-leasing spread was 25% on 0.4 msf and the renewal spread was 18%.

Pre-leasing represented one-quarter of the 0.8 msf gross-leasing total, based on the 0.2 msf signed at Sattva Endeavour. KRT's committed occupancy was 94% by value and 93% by area in Q2 FY27, although the presentation does not provide a prior-quarter overall portfolio occupancy comparison.

The detailed transaction schedule records 778,000 square feet of gross leasing, consisting of 650,000 square feet of new leases and 128,000 square feet of renewals. This differs slightly from the 0.8 msf headline because KRT presents the headline volume in rounded msf terms.

What share of KRT's leasing demand came from existing tenants?

KRT said expansions by existing occupiers produced 54% of new leasing and pre-leasing by gross rents in Q2 FY27, compared with 46% from new occupiers. The mix applies to 0.7 msf of combined new leasing and pre-leasing, rather than the full 0.8 msf gross-leasing figure that includes renewals.

The presentation attributes Q2 FY27 leasing activity to front-office and global capability centre (GCC) occupiers. Its transaction list covers GCC, domestic, multinational and co-working occupiers, with technology, banking, financial services and insurance, engineering and manufacturing, and pharmaceutical transactions among the disclosed sectors.

A global corporate administration firm took 188,000 square feet at Sattva Endeavour in a technology GCC transaction. Other disclosed new leases included L&T Hydrocarbon's 66,000 square feet at Prima Bay and a global investment manager's 56,000 square feet at Sattva Knowledge City in the banking, financial services and insurance sector.

Which cities generated KRT's Q2 FY27 leasing?

KRT reported Bengaluru and Mumbai as the largest contributors to Q2 FY27 leasing, at 0.3 msf each, followed by Hyderabad at 0.2 msf and the rest of India at 0.04 msf. These city figures add to the reported 0.8 msf gross-leasing total after rounding.

Mumbai portfolio occupancy rose to 95% in September 2026 from 89% in March 2026, an increase of 600 basis points. Prima Bay reached 100% occupancy from 88%, One Unity Center reached 95% from 84%, and both One BKC and One International Center reached 96%.

KRT reported a 28% spread on 0.6 msf re-leased or renewed in Mumbai in H1 FY27. It also identified 34% of Mumbai rentals as expiring through FY29, with average future mark-to-market (MTM), or rent reset toward stated market rent, of 31% through that period.

Bengaluru's 0.3 msf included the 188,000-square-foot Sattva Endeavour GCC lease. In Hyderabad, KRT said it had re-priced 0.6 msf since listing at a 41% spread, while describing a strategy of proactive churn and fit-out deals that include additional rent components.

How did KRT reprice Hyderabad leases?

KRT disclosed Hyderabad re-leasing spreads ranging from 33% to 92% across four examples, with the highest reported spread at Knowledge City. The presentation calculates rents and re-leasing spreads on gross rents, including fit-out and car-park rent.

At Knowledge City, a 44,000-square-foot Macquarie transaction moved from a previous adjusted rent of Rs 83 per square foot to Rs 159 per square foot, a 92% spread. Another 23,000-square-foot Knowledge City lease moved from Rs 103 per square foot to Rs 163 per square foot, resulting in a 59% spread.

At Sattva Knowledge Park, a leading pharmaceutical firm leased 42,000 square feet at Rs 170 per square foot versus a previous adjusted rent of Rs 127 per square foot, a 33% spread. A separate 56,000-square-foot Knowledge City transaction moved from Rs 78 per square foot to Rs 129 per square foot, a 65% spread.

KRT notes that the previous rent was adjusted for efficiency improvement in three of the four Hyderabad examples. That qualification means the stated deal-level spreads reflect the presentation's adjusted prior-rent methodology rather than an unadjusted historic-rent comparison.

What rent-reset opportunity has KRT disclosed?

KRT disclosed 21% portfolio-level MTM potential, comparing in-place rent of Rs 101 per square foot with market rent of Rs 122 per square foot. This portfolio measure is separate from the 24% average spread on 0.5 msf achieved in Q2 FY27 leasing transactions.

For H2 FY27, KRT listed 1.1 msf of upcoming expiries and said 66% was tied up or under closure at a 23% spread. It identified further expiries of 1.3 msf in FY28, 1.5 msf in FY29 and 1.0 msf in FY30, averaging 1.4 msf across the four disclosed periods.

The stated MTM potential was 22% for H2 FY27, 33% for FY28, 26% for FY29 and 21% for FY30. KRT calculated average future MTM potential through FY30 at 25%, while base rentals expiring ranged from 4% in H2 FY27 to 7% in FY28.

Conclusion

KRT's Q2 FY27 results show that expansions by existing occupiers were the larger contributor to new leasing and pre-leasing by gross rents, at 54% versus 46% for new occupiers. The mix coincided with 0.8 msf of gross leasing, a 24% average spread on 0.5 msf and equal 0.3 msf leasing contributions from Bengaluru and Mumbai.

The next disclosed execution measure is 1.1 msf of H2 FY27 expiries, of which KRT said 66% was tied up or under closure at a 23% spread. Management's disclosed FY28 expiry pool is 1.3 msf and carries a 33% MTM potential, the highest annual figure shown through FY30.