Brookfield India Real Estate Trust REIT (NSE: BIRET) Q2 2025 Earnings Call dated Nov. 07, 2024
Corporate Participants:
Alok Aggarwal — Chief Executive Officer and Managing Director
Ankit Gupta — President
Amit Jain — Chief Financial Officer – Brookprop Management Services Private Limited
Unidentified Speaker
Rachit Kothari
Analysts:
Puneet Gulati — Analyst
Mohit Agrawal — Analyst
Parvez Qazi — Analyst
Pritesh Sheth — Analyst
Sumit Kumar — Analyst
Yash Dedhia — Analyst
Dhiraj Dave — Analyst
Presentation:
Operator
Ladies and gentlemen, good day, and welcome to Brookfield India Real Estate Trust Q2 FY25 Earnings Conference Call. [Operator Instructions].
On the call, we have the following person: Mr. Alok Aggarwal, CEO and MD; Mr. Ankit Gupta, President; Mr. Amit Jain, CFO of Brookprop Management Services Private Limited; Mr. Rachit Kothari and Mr. Shailendra Sabhnani from Brookfield.
I now hand the conference over to the management. Thank you, and over to you, sir.
Alok Aggarwal — Chief Executive Officer and Managing Director
Yeah. Good morning, everyone. This is Alok. On behalf of the Brookfield India Real Estate Trust, I extend a warm welcome to all participants joining us today for this conference call. While global office markets face challenges, the Indian office market continued to show robust demand due to economic growth and an influx of global corporations increasingly setting up their offices in India. India continues to remain an attractive hub for talent. Recent reports forecast another record-breaking year for India’s office leasing market with total leasing across major cities expected to surpass 80 million square feet in 2024.
Brookfield India REIT has witnessed robust growth since IPO with our assets under management growing by more than 3x. We have achieved this increase in scale through both organic and inorganic activities. Our operating area has more than doubled, while our tenant base has been significantly diversified and derisked. The last 12 months have been a period of substantial progress for Brookfield India REIT. Our committed occupancy has grown by 500 basis points and is now at 85% as we have witnessed a substantial increase in demand for campus-style Grade A development. This demand has been driven by a strong return-to-office trend, as companies have called their employees back to the offices at least three, four times in a week.
We have witnessed demand for both SEZ and non-SEZ spaces with existing SEZ tenants taking up almost 4,47,000 square feet of expansion space during the quarter. In fact, tenants who had previously given us spaces in our campuses are now taking up additional units — additional spaces. This has been an ongoing theme over the last few quarters. We believe that this robust leasing demand will continue in the future and expect it to positively benefit our occupancy levels. We anticipate strong leasing momentum across our portfolio, leveraging the dual offerings of SEZ and non-SEZ spaces within our campuses. This approach enhances our ability to attract a diverse tenant base and accelerates our path to higher occupancy rates. We retain our fiscal year-end committed occupancy target of 87% to 89%.
Let me now invite Ankit to take you through the key highlights for the quarter.
Ankit Gupta — President
Thank you, Alok. Good morning, everyone. Let me take you through the key highlights for the quarter. We achieved a gross leasing of 1 million square feet in Q2 2025 with the fined rentals at INR124 per square foot versus the in-place rent of INR95 per square foot. This is driven by higher leases at our higher rental assets. The tenants that have been signed in the last quarter include GET Marine, Fidelity, Cognizant, ERGO, ESRI, Aristocrat, and Aptia amongst others. 4,47,000 square feet of the new leasing, which translates to around 66% of the overall new leasing of 6,79,000 square feet, has taken place in our SEZ assets. The implication here is that while non-SEZ demand continues to be strong, our SEZ assets are also witnessing robust traction. The leasing performance over the last 12 months has led to our committed occupancy increasing to 85%, approximately 500 bps increased from September 2023, which is Y-o-Y.
Our same-store NOI has increased by 18% over the last 12 months, driven by the improvement in occupancy and supported by contractual escalations and spreads achieved on re-leasing and renewals. We achieved a 9.4% average escalation on 1.9 million square feet during the year and 19% re-leasing spreads. We currently have a 2.8 million square feet of SEZ vacancy, of which 1.3 million square feet is currently under conversion to non-processes area. Against this 1.3 million, we have a robust pipeline of 2.2 million square feet. Backed by the strong leasing momentum that we have witnessed and the conversion of space to non-processing area, we expect to achieve a net leasing of 0.4 million to 0.9 million square feet in H2. With this, we expect our occupancy to reach 87% to 89% by the end of the year, which is in line with the guidance we had given earlier.
Sustainability remains core to Brookfield India REIT’s business strategy. We lead ESG excellence initiatives focused on creating future-ready assets, meeting evolving tenant needs while contributing positively towards environmental sustainability goals. During the quarter, we have achieved milestones such as reaching 40% renewable power transition for 15.4 million square feet across four marquee assets, namely G1 and G2 in Gurugram and N1 and N2 in Noida, sourced from Brookfield’s Bikaner Solar Power Project. This was achieved through a first of its kind agreement in India under the Inter-State Transmission System bilateral arrangement. We remain on track to achieve 100% green power by 2027 across our entire portfolio in India.
During the quarter, we achieved a 5-star GRESB Rating for the third consecutive year and were recognized as the Global Sector Leader for Sustainable Mixed-use Development for our under-construction project at K1. We are actively reducing our environmental impact through initiatives like solar power, water conservation, waste reduction, air purification, and EV adoption. Our commitment extends beyond environmental impact. We strive to create vibrant and empowered communities through various social initiatives and programs. Collaborations with organizations such as People for Action and the Earth Saviors Foundation exemplify our commitment to fostering community development and enhancing social well-being.
With that, I’d like to invite Amit to provide the financial updates.
Amit Jain — Chief Financial Officer – Brookprop Management Services Private Limited
Thank you, Ankit, and good morning, everyone. Our operating lease rentals have grown to INR426 crore in Q2 FY25, 1% higher q-o-q compared to INR420 crore in the previous quarter and 55% higher y-o-y compared to INR274 crore in the same period last year. The adjusted NOI for Q2 FY25 is at INR486 crore, 2% higher q-o-q compared to INR475 crore in the previous quarter and 40% higher y-o-y compared to INR347 crore in the same period last year.
The y-o-y growth is primarily because of the acquisitions of Downtown Powai and Candor TechSpace G1 being completed only midway through Q2 FY24 and are therefore reflected in Q2 FY24 financials for part of the quarter. We are distributing INR4.6 per unit for this quarter, translating to a total distribution of INR221 crore. We are pleased to highlight that the dividend component of the distribution has been maintained at 11% this quarter. We expect the dividend component to improve going forward.
If we consider only a 50% share of the NOI from the three assets where we own a 50% stake, our current adjusted NOI run rate is INR17.5 billion on an annualized basis. Steady leasing recovery can drive around 14% growth in our NOI run rate and consequently lead to a 27% growth in distributions. This would translate to a distribution per unit on a stabilized basis of INR24.2, without accounting for any impact on account of rent growth, contractual escalations, MTM, and changes in the interest rates.
We continue to maintain a dual AAA rating from ICRA and CRISIL on the back of our strong balance sheet, a long-dated maturity profile, and limited amortizations over the next few years. In fact, we are pleased to report that CRISIL has revised the outlook for Brookfield India REIT from negative to stable. A majority of our loans are linked to repo rate, which will benefit us as the benchmark rates begin to trend lower.
With that, I would request the moderator to open the floor for Q&A.
Questions and Answers:
Operator
Thank you very much. We will now begin the question-and-answer session. [Operator Instructions] The first question is from the line of Puneet from HSBC. Please go ahead.
Puneet Gulati
Yeah. Thank you so much and congratulations on some progress on occupancy. My first question is with respect to G2. There seems to be a bit of a fall in NOI on a q-on-q basis and a little lower vacancy as well. What’s happening on G2 side?
Alok Aggarwal
You’re talking about the occupancy in G2, right?
Puneet Gulati
Occupancy in G2 and also the NOI has also fallen q-on-q.
Alok Aggarwal
Yeah. So Puneet, I don’t know if it’s in the last call also I have maintained that we are — if you really see in SEZ, here we can see large vacancies in three assets, one is G1, one is N2 and one is G2. And we expect G1 and N2 to ramp up much faster and G2 would ramp up with bit of a lag, as I said that last time also. And we — our pipeline is strong. We are working to ramp up the occupancy and we’re expecting a good pick up from at least non-SEZ tenants in near future. [Speech Overlap] Sorry. So, pipeline is good. We should expect occupancy to ramp up, but it would lag behind G1 and that is something I’ve maintained last time also.
Puneet Gulati
Understood. But what really is the reason why G2 specifically is seeing extra weakness? Also, there was a pickup in occupancy in Q1 and Q2 has dropped marginally, but your NOI has dropped more meaningfully.
Alok Aggarwal
So there is no specific reason that why it has dropped, as we always maintained that leases could be lumpy and we were expecting some leasing, which has not materialized. But yes, G1 and N2 are ahead of curve, they are better placed to attract new tenants and ramp up the occupancy. But G2 also will show that occupancy will move up.
Puneet Gulati
Okay, sir. And secondly, if you can talk about the leakages in the NDCF walk down, from NDCF at REIT level, which is INR2,481 million down to the distribution of INR2,285 million. If you can help us understand what are the leakages there? It will be very helpful. Thank you.
Amit Jain
So you’re talking about generation of INR4.76 versus DPU of INR4.6 per unit, right?
Puneet Gulati
No, no. So INR2,481 million NDCF, which is at SPV level for REIT and down to the NDCF at REIT level, what are the additional numbers? There seem to be INR202 crore additional borrowing, if you can talk a bit about that despite that there is a negative impact here on NDCF — on the REIT level of NDCF?
Amit Jain
So basically what you’re saying is, so you know when as per the regulations, the SPVs are required to distribute at least 90% of the distribution to REIT, right? So although the generation at the SPV level is around INR248 crores, but then based on the revised framework, there is a requirement at the REIT level to retain reserves for the interest expense at the REIT level. So REIT has certain CPs, right, on which interest clock [Phonetic] around INR20 crores is accrued on quarterly basis. So that is how that reserve is created at the REIT level and therefore the distribution at the REIT level is around INR228 crores. The NDCF at the REIT level is around INR228 crores.
Puneet Gulati
Understood. That INR20 crores is financing costs.
Amit Jain
That’s correct.
Puneet Gulati
Correct. That’s all from my side. Thank you so much.
Operator
Thank you. The next question is from the line of Mohit Agrawal from IIFL Securities. Please go ahead.
Mohit Agrawal
Yeah. Thanks for the opportunity.
Operator
Due to no response from the current participant, we will move on to the next participant. The next question is from the line of Parvez Qazi from Nuvama Group. Please go ahead.
Parvez Qazi
Hi, good morning and thanks for taking my question. So my question is regarding G1. We have seen an improvement in occupancy. You also said that it is tracking ahead of G2. Now, here we will see income support ending by I guess June ’25. So, by that time, what is your estimation of the occupancy that we will be able to achieve in G1?
Ankit Gupta
Yeah. So again, that’s one — the income support that we have is — if you do the calculation, which is attributable to REIT is roughly about INR17 crores. And both in terms of G1 on a standalone basis as well as for the overall portfolio, we feel very confident that we don’t see any short-term dip due to this income support getting over. The G1 asset continues to see strong pipeline. As you can see the numbers for this quarter as well, we have been able to increase the occupancy from a 69% to 74%. We continue to see a healthy leasing momentum there, both on SEZ as well as non-SEZ with the recent conversion around the corner. And on an overall portfolio level as well with mark-to-market with escalations and new leasing, we feel more than comfortable to be able to more than offset the income support dip that will come in. So there should be absolutely no challenge in replenishing that even in the immediate quarter after the income support finishes.
Parvez Qazi
Sure. My second question is regarding the SEZ area. So of the vacant SEZ space of 2.8 million square feet, we have about roughly half of it under conversion. So for the balance 1.5 million square feet, what is our strategy? We want to keep it under SEZ to take care of any leasing demand that we might see in SEZ or in future we would like to convert that also.
Ankit Gupta
So unlike Pervez, if you see the — this quarter’s performance and as I mentioned in my note earlier, of the total leasing that has happened in this quarter of about 700,000, about 4,70,000 has come from existing SEZ expansion demand in our assets. So at least we — in our portfolio over the past several quarters have continued to see a meaningful SEZ demand in our new lease up every quarter. And therefore, we are going ahead with about 1.3 million square feet and keeping the remaining 2.5 million square feet for SEZ for this kind of demand to be catered to.
As the 1.3 million square feet gets leased up by the non-SEZ tenants. We can take a call on the remaining 1.5 million, but right now, we want to keep that as SEZ allocated given the demand we continue to see, which has as an example has actually been shown in this quarter and the previous quarter results.
Parvez Qazi
Sure. Thanks and all the best. Thank you.
Operator
Thank you. The next question is from the line of Pritesh Sheth from Axis Capital. Please go ahead.
Pritesh Sheth
Yeah. Good morning, everyone, and thanks for the opportunity. First question, I just wanted to understand what was the dividend or NDCF from north portfolio this quarter. Last quarter, I think it was INR21, INR22 odd crores. What was that amount this quarter?
Amit Jain
That’s around INR32 crores for this quarter.
Pritesh Sheth
Okay. And just wanted to understand in terms of leakage at the NDCF from SPV for REIT level, that was INR248 crores, right? And if I add that another INR31 crore, INR32 crores that we have got from North portfolios, that makes it INR270 crores, but total NDCF was INR252 crores. So the difference is what you were explaining earlier about keeping reserves for paying off interest at the REIT level, etc., is that understanding right?
Amit Jain
Dividend from North Commercial portfolio is INR20 crores and the balance dividend has come from other 100% owned SPVs of REIT, right? So basically, the total distribution that REIT has received, as I was explaining earlier from the SPVs including the dividend component from North Commercial portfolio. Out of that, a INR20 crore reserve is being kept to service the interest at the REIT level on commercial papers and that is how we are arriving at a NDCF of INR28 crores at the REIT level.
Pritesh Sheth
Sure. Got it. And we had NDCF of INR4.76 per unit this quarter versus distribution was INR4.6, so why not a 100% payout this quarter? Any specific reason for that?
Amit Jain
Pritesh, it’s a difference of 16 paisa, hardly 3%, 3.5% in the overall scheme of things and we are just keeping that minor amount for any eventualities. In addition, if you look at our guidance, we have given guidance of INR18.5 plus-minus 25 paisa. So, if I take an average of INR18.5, in the previous quarter, we had distributed INR4.5, so the remaining is about INR14 for the three quarters, which averages to about INR4.66. So, we have distributed INR4.6 just to even out the distribution for these remaining quarters. And in any case, if there is anything extra that is left, within this financial year itself we will distribute. So, it’s basically just to even out the distribution over the quarters.
Pritesh Sheth
That’s fair. And we have taken approval for INR3,500 plus — sorry, INR350 crore of capital raise that would largely be for debt repayment?
Unidentified Speaker
Sorry, could you just repeat the question?
Pritesh Sheth
You have taken approval for a capital raise, what would be the purpose of that capital raise?
Unidentified Speaker
Sort of this is an enabling resolution that allows us to be ready to capitalize on any future growth opportunities that may arise. In the interim, this may be used, if any for debt reduction.
Pritesh Sheth
Right. That’s it from my side. All the best.
Operator
Thank you. The next question is from the line of Mohit Agrawal from IIFL Securities. Please go ahead.
Mohit Agrawal
Thanks for giving me an opportunity again. So, the first question is more of a clarification for you to achieve 87% to 89% occupancy target by the year end. If I take a midpoint, 88%, is my understanding correct that you need a net area like a leasing addition of 0.7, 0.8 and then you have about 0.5 million square feet of area expiring? So that makes it to the net leasing target from here on second-half is about 1.3 to 1.4 million square feet. Is that understanding correct?
Alok Aggarwal
Yeah, that’s right. If you take 88% kind of occupancy, we’ll need around 1.3 to 1.4 million square feet of new leasing.
Mohit Agrawal
And you have done 0.9 million square feet of net leasing so far in first half. So that — so the annual target that you need to do for — which you had earlier given for 1.5 million. I’m just trying to understand how this kind of resets your annual target. So your annual target is closer to about 2.3, 2.4 million square feet net leasing.
Ankit Gupta
No, annual target will be around 2 million square feet on new leasing 2 million — so we have guidance 1.52 [Phonetic]. So if you take 88%, yes, it will cross 2 million. It will — if we 88% — for 88%, if we had to cross 2 million, yes, annual target.
Mohit Agrawal
Okay. And the pipeline that you’re looking for, you’re confident of about achieving that about 1.3 million, 1.4 million square feet of net leasing.
Ankit Gupta
Yes. So, yeah, for a net — for 87% to 89%, like you had mentioned earlier, we need a net leasing of about 1.5 million square feet for an 88%. And of that, we have already achieved about 0.9. So the remaining 0.5, 0.6 million square feet as a net leasing for the remaining half of the year, we feel very confident about.
Mohit Agrawal
Okay. I have a few follow-ups on that, maybe I’ll take that offline. My second question is you continue to — we continue to see increases in the expiry number and so it seems to be getting new fresh expiry notices in this quarter as well. So is this more like a regular churn or do you think there’s still that IT services segment, which is kind of or that is — that part is not settled yet. So if you could just clarify if this fresh expiry notices is more like the regular business or still not settled from…
Ankit Gupta
Yeah. So, this I would definitely classify as regular course of business. In fact, if you see even in this quarter, as an example, Cognizant has grown in our portfolio. And we have seen some good demand coming back, although cautious, but definitely positive from some of the other IT services companies which are starting to grow back into the market. So I think that era of downsizing is definitely behind us. This increase in expiries is basically regular course of business, but I would also say that the robustness of our demand for our high-quality Grade A assets is high enough for us to have maintained our occupancy guidance of 87% to 89%, which we had given earlier as well, in spite of the higher expiries because we are increasing our new leasing target guidance. So overall, we feel confident of the regular course of business for us to be able to cater to meet and overcome these expiries.
Mohit Agrawal
Okay. Any particular tenant or any particular asset where you’ve seen the fresh notices coming in?
Ankit Gupta
No, this is spread across a few assets not targeting any one particular asset. So I would not pinpoint any specific one particular tenant attributable to this requirement. And therefore, I feel comfortable in sharing this as a regular course of set of expiries.
Mohit Agrawal
Okay. Perfect. Thanks a lot.
Ankit Gupta
Thank you.
Operator
Thank you. The next question is from the line of Sumit Kumar from JM Financial Institutional Services. Please go ahead.
Sumit Kumar
Hi, good morning. Thanks for the opportunity. My first question is on the same store growth of lease rentals. That INR548 million, if you could break it down to how much comes from increase in occupancy and how much from escalation and rental growth?
Ankit Gupta
Yeah. Hi, Sumit. So the 18% growth of same store NOI that we have been able to demonstrate, which is a very healthy same store NOI growth breaks up as occupancy growth contributing to about 8% — lease-up of about 8%, escalations of about 4% to 5%, a mark-to-market improvement of about 4% to 5% and some cost savings also of 1% to 2%. So it’s a healthy mix of this distribution.
Sumit Kumar
Okay. And a second question if I may, there was this cap reduction plan as well. So any update on that? What has happened over the last two quarters?
Amit Jain
Yeah. So our capital reduction schemes for the three assets were approved and in fact, we have started making distributions from one of the assets, N1, and the balance two assets, we expect that over the next two, three quarters, we should start distributing dividends from those assets as well.
Sumit Kumar
And any guidance on how the mix would look like going forward from the current 60%, 65%?
Amit Jain
So we are expecting that our dividend component of distribution should increase to 20% to 25% from the current level of around 11%. So once these [Indecipherable] schemes are fully implemented, then the dividend component would increase to 20% to 25%.
Sumit Kumar
Sure, sir. Thank you. That’s all from my side.
Operator
Thank you. The next question is from the line of Yash from Maximal Capital. Please go ahead.
Yash Dedhia
Good morning, sir. Sir, on Slide number 11, you have given a pro forma at 100% occupancy for the NDCF. But how does it pan out, let’s say, at 88% which is the midpoint of the guidance for this year?
Ankit Gupta
So the — on Slide, yeah — so Slide 11, yes, this is at 100% occupancy. At 88%, we will — which is basically the guidance we are giving for by end of this year, so that will be in line with — for this year with the guidance of the 18.5% plus/minus 25% that we have given earlier. Post that, obviously, you will see an uptick because the run rate will change. But for this year, the guidance will continue to be in the range of 18.5% plus/minus 25%.
Yash Dedhia
But given current trends like — what would be guidance, if any, for FY26?
Ankit Gupta
For that, we’ll have to get back. Right now, we are focusing on our guidance for this year and therefore putting our heads down to making sure that operationally we deliver — we delivering on that one. For the guidance for next year, we’ll kind of share that subsequently at the right time.
Yash Dedhia
Okay. And on the spreads, so I’m a bit confused. So, you said that on the existing renewals, you are getting around 5% sort of a markup.
Ankit Gupta
Yeah.
Yash Dedhia
So 5% markup on that and 5% on mark-to-market for the new leasing. Is that the right way of looking into it? So basically when you are getting a new tenant, and you are getting a 5% sort of more than what was the existing rent for the old tenant?
Ankit Gupta
Yeah, about 4%, but yeah, 4% to 5% in that range. That’s the mark-to-market — that’s the mark-to-market baked in into the 18% same-store NOI growth.
Yash Dedhia
And how does that relate with the spread percentage data which is there on Slide number 7?
Rachit Kothari
Sorry, Rachit here. I think the question, if I understood correctly is that when we break down the 18% growth, which in absolute terms will be about INR40 crores a quarter, give or take. Your question is why is that 5%? It’s actually — it’s a 5% of total absolute growth, not on a lease-by-lease basis. On a lease-by-lease basis, the numbers will corroborate with what you see on the leasing success page of the presentation, which is about 21% on renewals and about 17% on new leasing. So what Ankit described as 5% was really the breakdown of the absolute quantum of 18% growth.
Yash Dedhia
Okay. So put it another way, this 17%, 21%, 19% over what period is this happening on average?
Unidentified Speaker
See, the 17% and 21% you see on the slide is for Q2, right? And as Rachit explained, this number represents what is the increase in the rent on the area where we did a new leasing or a renewal. The number of MTM of 4% was on the entire base of the NOI of the asset, which will also include a lot of the legacy leases where there is no new leasing or renewal. So it’s on the entire base 17% and 21% is only on the area where there is a new leasing or a renewal which is happening.
Rachit Kothari
To put it differently, I think we see about 8% to 9% of our leased area churn every year by way of regular course expiries, which is ordinary course of business for us. You see these spreads, if you see our history for the last six or eight quarters, you’ll see the spreads pretty much consistently everywhere where these renewals and new leasings happen. So it’s on an average, I think about 8% to 10% of area every year, which goes through this churn achieve such rates.
Yash Dedhia
So that will add another 1% — 1%, 1.5% to your overall…
Rachit Kothari
Growth, yes, absolutely.
Yash Dedhia
Okay. Okay. Understood. And then apart from that, your typical terms would be 4%, 5% escalation every year.
Rachit Kothari
Yeah. Yes.
Yash Dedhia
Okay. Okay. Understood. And just one final thing. So are — when you’re converting this SEZ to non-SEZ, are you seeing any compression in the rentals in any of those properties?
Ankit Gupta
No, as we are converting to non-SEZ, we are in fact seeing two kinds of outcomes. One, in assets where we already are helding on our occupancy, we are seeing an uptick given the kind of demand. If you see, for example, in Calcutta, we were earlier on a SEZ basis tracking at about INR44, INR45 of rental. The deal that we did with HDFC for the non-SEZ part was at about INR53. So, we’ve seen a healthy uptick there. In some of our other assets, as we are doing the conversion to non-SEZ, our current focus is to focus on accelerating the velocity of the take up which in the interim we will focus on at similar rentals. And once we achieve higher occupancies there, we will also focus on premiumization with higher occupancies. So, there we will start seeing more rental upticks as well.
Yash Dedhia
Understood. What’s the current debt to AUM and what’s the target on sort of taking it upwards or downwards?
Unidentified Speaker
Net to AUM.
Ankit Gupta
Sorry, what’s the question?
Amit Jain
What is our net to AUM?
Ankit Gupta
So our LTV ratio excluding third-party shareholder loan is 34.5%. And if you are including the shareholder debt from GIC who was there in G1 [Indecipherable], the LTV ratio is 38%.
Yash Dedhia
And since it is lower than the regulatory threshold, is there a plan to sort of take it upwards in the coming years, and what would be that?
Amit Jain
No, actually, in fact, we are intending to bring it downward as that’s been resolution, but there is no plan to increase the LTV ratio for sure.
Yash Dedhia
Okay. So the further growth, how are you planning that with — that will help happen with the equity infusion only or how are you planning that?
Unidentified Speaker
Yeah. So look, the further growth will largely be — and if you see how we’ve done the last acquisition, will largely be while maintaining the LTV ratios in the current zone and effectively that would entail, call it two-thirds equity, one-third debt on a go-forward basis.
Yash Dedhia
So, these will be primarily with large landlords and they getting units of the REIT as previously with the Bharti Group?
Unidentified Speaker
So, look what you saw with the Bharti Group was a swap where the consideration was settled in terms of units. If you look at the acquisitions that we did last year, there was a mix of cash and units. So, going forward we take a call at that point in time on what would be the appropriate mix for discharging the consideration for that acquisition.
Yash Dedhia
And since you are trading at a value which is lower than the NAV, so every time you issue these units, is this NAV accretive or does it help the existing unit holders?
Unidentified Speaker
Yeah. So look, if you look at the last acquisition that we did earlier this year, which was the North Commercial portfolio, it was accretive on an NAV basis, it was accretive on a NDCF basis. So that’s just one precedent that I would like to direct you to look at.
Yash Dedhia
Understood. Thank you, sir, for patiently asking all the questions, and thanks a lot.
Unidentified Speaker
Thank you.
Operator
Thank you. The next question is from the line of Dhiraj Dave from Samvad Financial Services LLP. Please go ahead. Mr. Dhiraj, I would request you to unmute your line and speak, please.
Dhiraj Dave
Yeah. Can you hear me now?
Alok Aggarwal
Yes, we can hear you now.
Dhiraj Dave
Yeah. So one question is, what is the kind of — in this new rentals, can you give us a breakup of GCC clients and non-GCC clients and what is the management views about getting to that area?
Unidentified Speaker
So, Dhiraj, if I understand the question, you’re basically asking of the rent, what is the breakup between GCC and non-GCC tenants?
Dhiraj Dave
Yes.
Unidentified Speaker
Okay. Maybe we will answer that directionally, but I’ll just hand it over to Ankit.
Ankit Gupta
So Dhiraj, for example, this quarter, and I can give you an area perspective, rents we’ll need to carve out, but I think it should be in the similar range. About 35% to 40% of our total area lease-up has been done by GCC. Even if you take our overall portfolio, it is in that range. So if we had to take a direct extrapolation, you can take a kind of a rental average also in that range, though we’ll have to do specific numbers on that.
Dhiraj Dave
Okay. And how do you see growth because there is roughly a pattern of growth being — demands from GCC is higher than non-GCC or [Indecipherable] robust?
Ankit Gupta
We do continue to see a very robust demand from GCC. Domestics are growing as well. But I think GCC in general across the country and we are seeing this in all our locations are going in a very healthy way, including the demand for our specific assets is on a very high full basis by the GCCs.
Dhiraj Dave
Okay. Thanks so much. Wish you all the best.
Operator
Thank you.
Ankit Gupta
Thank you.
Operator
[Operator Instructions].
Alok Aggarwal
Are there any questions? We can wait for maybe 15 seconds if somebody wants to ask any question. We’ll wait for [Indecipherable] if somebody wants to ask questions. Can wait for 15 seconds, if someone wants to ask a question. Yes, there [Indecipherable] there is some time.
Operator
There are more than 20 parties in the conference.
The next follow-up question is from the line of Yash from Maximal Capital. Please go ahead.
Yash Dedhia
Sir, thank you for the follow-up. So can you walk us through your liability structure in terms of how much is external benchmarks-related loans and how much is MCLR, etc.? And then what would be the sensitivity on the overall NDCF for the — let’s say, 0.5% decrease in the benchmark repo rates?
Amit Jain
So, yes, so our reported linked portfolio represents 81% of the total loan book, right, and so a 50 bps reduction in the benchmark rates. Currently, our average interest cost is around 8.36%, right? So on an overall loan portfolio of around INR11,000 crore, so 50 bps reduction would lead in a saving of around INR50 crores, so that is how we are looking at it.
Yash Dedhia
Understood. And finally, now because of this some geopolitical problems between India and Canada. So is there any sort of change in the way we are looking at expanding this portfolio out of the REIT? Going forward, any change in — from the sponsor side or what you have discussed with them?
Ankit Gupta
Yeah, Yash, there is absolutely no impact of any of that in our context.
Yash Dedhia
Okay. Thank you.
Operator
Thank you. As there are no further questions, I would now like to hand the conference over to the management for closing comments.
Alok Aggarwal
Yeah. So thank you, everybody. Thank you everyone for joining today’s call. We look forward to connecting with you next quarter. Thank you.
Operator
[Operator Closing Remarks].