How REITs report results: NAV, distribution per unit and occupancy explained
A real estate investment trust (REIT) reports a different set of numbers from a typical company: net asset value, distribution per unit, distribution yield and portfolio occupancy. What each term means and what SEBI requires REITs to disclose, with an illustrative example.
A real estate investment trust (REIT) owns income-producing property — mainly rent-yielding office parks in the Indian REITs listed so far — and holds units that trade on an exchange, the way a company’s shares do. It does not report profit the way a manufacturer or a retailer does; a REIT’s results centre on the value of what it owns, how much it pays out to unit-holders, and how full its buildings are.
Net asset value (NAV) and gross asset value (GAV)
- Gross asset value (GAV): the total value of the REIT’s property portfolio, as assessed by an independent valuer.
- Net asset value (NAV), usually expressed per unit: broadly, the value of the REIT’s assets minus its liabilities, divided by the number of units outstanding. SEBI’s rules for REITs require the portfolio to be valued by an independent, SEBI-registered valuer, and the REIT to disclose the resulting NAV, at least once every six months.
- Embassy Office Parks REIT — India’s first listed REIT — reported a portfolio GAV of ₹70,540 crore for the year ended 31 March 2026, up 15% year on year, alongside a NAV of ₹491.62 per unit, up 16% year on year, in its FY2026 results.
NAV is a valuation figure, not a market price: a REIT’s units can trade above or below their NAV per unit on the exchange, the same way a company’s share price can differ from its book value.
Distribution per unit (DPU) and distribution yield
Most of a REIT’s income is required to reach unit-holders as cash. SEBI’s framework requires a REIT to distribute at least 90% of its net distributable cash flows (NDCF) to unit-holders, at least once every six months; in practice, most listed Indian REITs distribute quarterly.
- Distribution per unit (DPU): the cash paid out per unit held, for a stated period. Embassy REIT’s results reported a Q1 FY2027 (quarter ended June 2026) distribution of ₹598 crore, or ₹6.31 per unit, up 9% year on year; for the full year FY2026 its distribution was ₹25.28 per unit.
- Distribution yield: DPU (usually annualised) divided by the unit’s price, expressed as a percentage. Because it depends on the price paid for the unit, and unit prices move daily, this site does not compute or quote a distribution yield against a live unit price for any named REIT — the illustrative example below shows only how the ratio is calculated.
Occupancy and net operating income (NOI)
- Portfolio occupancy (usually “by value” or “by area”): the share of leasable space that is actually leased, often broken down by city or building. Embassy REIT reported portfolio occupancy of 94% by value for FY2026, and 93% by value for Q1 FY2027, with occupancy varying by city (for instance, Mumbai and Bengaluru reported separately from Chennai and Noida in its results).
- Net operating income (NOI): rental and related income from the properties, minus the direct operating costs of running them, before the REIT’s own corporate-level costs, interest and depreciation. It is the closest REIT equivalent to an operating-profit figure, and is what the 90% NDCF distribution requirement is ultimately drawn from. Embassy REIT reported NOI of ₹3,760 crore for FY2026, up 15% year on year, and ₹1,020 crore for Q1 FY2027, up 17% year on year.
An illustrative example
A fictional office REIT, in ₹ crore except per-unit figures, for one year, with a hypothetical unit price used only to show how distribution yield is calculated:
| This year | |
|---|---|
| Gross asset value (GAV) | 20,000 |
| Net asset value (NAV) per unit (₹) | 300 |
| Net operating income (NOI) | 1,200 |
| Net distributable cash flow (NDCF) | 900 |
| Distribution per unit (DPU) (₹) | 18.00 |
| Hypothetical unit price (₹) | 240 |
| Distribution yield | 7.5% |
| Portfolio occupancy | 91% |
Here, the REIT distributed 100% of its NDCF (above the 90% minimum), and the distribution yield of 7.5% comes from dividing the ₹18.00 DPU by the hypothetical ₹240 unit price. A REIT trading above its NAV per unit, or with falling occupancy, would show a different relationship between these numbers even if DPU stayed flat. None of this is a comment on what any real REIT’s units are worth or will pay in future; a distribution is not guaranteed and past payouts do not determine future ones.
What these numbers don’t tell you
NAV depends on a valuer’s assumptions (rental growth, discount rates, capitalisation rates) and is only refreshed periodically, not continuously. Occupancy figures can also mask lease-expiry risk — a portfolio can be fully occupied today with a large share of leases due to expire in the same year. Reading the REIT’s own commentary on lease expiries and re-leasing, alongside the headline occupancy number, gives a fuller picture than occupancy alone.