KRT Rs 700 cr Bengaluru office plan: 1.4 mn sq ft

Expansion plan centres on Bengaluru development

Knowledge Realty Trust (KRT) has outlined a new development push in Bengaluru, with an investment plan of around Rs 700 crore over the next three years. The spending is tied to the creation of a new office block that adds 1.4 million sq ft of area in the city, as part of a broader expansion plan discussed by a senior company official, Godbole. The upcoming supply is positioned within KRT’s wider office portfolio strategy, where under-construction and future development pipelines are key levers alongside leasing. The timeline and scale matter because Bengaluru remains one of India’s most active markets for large, Grade A office projects. The announcement also comes alongside updated data points on leasing, financing, and capital market activity related to the REIT.

New office block at Sattva Global City

On the development side, KRT has commenced construction of a new 1.4 million sq ft office block at Sattva Global City in Bengaluru. The trust has indicated it will invest around Rs 700 crore over the next three years on this upcoming project. This addition sits alongside an existing under-construction portfolio, creating a visible pipeline that can be offered to occupiers over the next few quarters. The scale is notable because a single project of this size typically attracts multi-floor tenants and can influence near-term leasing conversations. While KRT has not shared unit-level pricing or expected completion dates for the 1.4 million sq ft block in the provided details, the trust has framed the spending as part of an expansion plan in the city.

Under-construction pipeline: what is near completion

KRT’s under-construction portfolio includes 1.2 million sq ft of office space that is “almost complete”, according to Godbole. Separately, construction works on the 1.4 million sq ft area in Bengaluru have “just started”, based on the same update. In another statement on project timelines, the trust indicated that the 1.2 million sq ft under construction will be completed by the end of FY26. Together, these updates provide investors and tenants a clearer view of how soon new supply may be ready, with the 1.2 million sq ft closer to delivery and the 1.4 million sq ft at an earlier stage.

Portfolio snapshot across six cities

KRT is among the country’s large office REITs, with a portfolio described as spread across six cities. As of September 30, 2025, the trust reported 29 office assets totaling 46.4 million sq ft. Of this, 37.1 million sq ft is completed area, 1.2 million sq ft is under construction, and about 8 million sq ft is classified as future development across six cities. KRT has also been described as owning over 46 million sq ft of office assets across 29 assets in six cities, with a primary presence in Mumbai, Bengaluru, and Hyderabad. The portfolio includes assets such as One BKC and One World Center in Mumbai, Knowledge City and Knowledge Park in Hyderabad, and Cessna Business Park and Sattva Softzone in Bengaluru.

Occupancy and leasing performance in FY26 so far

Within the completed portfolio, KRT reported 92% committed occupancy for the 37.1 million sq ft of completed assets. Leasing activity in the first half of FY26 was reported at 1.8 million sq ft. The leasing mix included 1.2 million sq ft of new leases and 0.6 million sq ft of renewals. These numbers help contextualise why the trust is continuing to add development pipeline, especially in Bengaluru, where a meaningful share of new construction and proposed leasing opportunities have been highlighted.

Funding update: FY26 debt raise and credit rating

Alongside development and leasing disclosures, KRT reported raising debt worth Rs 4,200 crore during FY26 at a blended cost of 7.3%. The trust also obtained a CRISIL A1+ credit rating for its Rs 500 crore commercial paper programme. These datapoints are relevant because office REITs typically use a mix of debt and equity to fund acquisitions, development, and refinancing, and because interest costs can shape distributable cash flows over time. In the provided updates, KRT has shared both the scale of debt raised and the blended cost, offering a clearer picture of funding conditions.

Growth drivers highlighted by the trust

KRT has cited multiple growth drivers tied to leasing and rent dynamics. These include Rs 580 crore of contractual rent escalations. The trust also pointed to the opportunity to lease 3.2 million sq ft of vacant completed space. Another lever cited is a 22% mark-to-market opportunity. In addition, the trust highlighted leasing potential linked to a 1.2 million sq ft new Bengaluru development, connecting the development pipeline with future leasing.

IPO update: subscription, anchors, and price band

Separately, KRT’s REIT initial public offering (IPO) was reported as fully subscribed on the first day of bidding and ended the day with 1.20 times subscription. The Rs 4,800-crore IPO received bids for 25,04,91,300 units against 20,84,20,800 units on offer, according to NSE data cited in the report. KRT also said it had garnered Rs 1,620 crore from anchor investors, including Amundi, Wells Capital, and Jhunjhunwala Trust. Additionally, the company received a strategic allocation of Rs 1,200 crore from institutional investors. The IPO is scheduled to conclude on August 7, with a price band of Rs 95 to Rs 100 per unit.

Key facts at a glance

IPO numbers summary

What this means for Bengaluru and REIT investors

For Bengaluru, the start of construction on a 1.4 million sq ft block adds to the city’s pipeline of large-format office projects and could expand options for tenants seeking campus-scale developments. For KRT, the announcements combine three threads investors often track in office REITs: development readiness (1.2 million sq ft nearing completion), medium-term pipeline (the 1.4 million sq ft new build), and leasing momentum (1.8 million sq ft leased in H1 FY26). The financing disclosures, including Rs 4,200 crore of FY26 debt at a 7.3% blended cost and the CRISIL A1+ rating for a Rs 500 crore CP programme, provide additional context on funding and liquidity. The IPO details further indicate active investor participation, with first-day subscription at 1.20 times and the issue set to close on August 7.

Conclusion

KRT’s plan to invest around Rs 700 crore over three years for a new 1.4 million sq ft Bengaluru office block strengthens its development pipeline as it continues leasing and portfolio expansion across six cities. Near-term, the completion target for the 1.2 million sq ft under-construction space by end-FY26 will be a key operational milestone, while the IPO process and stated growth drivers will remain in focus until the offer concludes on August 7.