Ladies and gentlemen, good day and welcome to earning conference call of Nexus Select Trust for Q4 and FY 2026. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Pratik Dantara, Chief Investor Relations Officer and Head Strategy from Nexus Select Trust. Thank you, and over to you.
Thank you. Good evening, everyone, and thank you for joining the earnings conference call of Nexus Select Trust for Quarter 4 and year-ended March 2026. Before we proceed, I would like to highlight that the management may make certain statements that may constitute forward-looking statements. Please be advised that our actual results may differ materially from these statements. Nexus Select Trust does not guarantee these statements or results and is not obligated to update them at any point of time. Specifically, any financial guidance and pro forma information that we will share on this call are management estimates based on certain assumptions and have not been subjected to audit review examination procedures. You are cautioned not to place undue reliance on such information, and there can be no assurance that we will be able to achieve the same.
Joining me today on the call are Dalip Sehgal, Executive Director and CEO, Rajesh Deo, our CFO, Jayen Naik, President, Operations, Nirzar Jain, President Leasing. As always, we will begin with brief remarks on our business and financial performance and then open the floor for questions. Over to you, Dalip.
Thank you, Pratik. Good evening, everyone. It is my pleasure to welcome you to the earnings update call for Quarter 4 and full year ending 31st March 2026 for Nexus Select Trust, India's first listed REIT. This year marks a significant milestone for us as we complete 10 years of building the Nexus platform. Over the past decade, we have created a resilient portfolio of 19 malls across 15 cities, comprising nearly 11 million sq ft of operational retail space that witnesses good footfalls of around 14 crore or 140 million. Today, our portfolio generates annual consumption of over INR 14,000 crore and delivers close to INR 2,000 crore of net operating income. Across our malls, we host nearly 1,100 odd brands across 3,200 stores, offering a healthy mix of leading international and domestic brands.
Most importantly, the Nexus portfolio today supports a large ecosystem with over 5,000 employees working across our portfolio and more than 20,000 tenant employees serving customers every day. The ecosystem is more than 25,000 people, the Nexus ecosystem. Before we delve into the quarter and the year-end performance, I wanted to spend a couple of minutes on the emerging macro trends in the retail real estate landscape in India. Demand-supply dynamics, one. Graded demand-supply dynamics continue to be extremely favorable for us, with no near-term new graded supply of any large scale in primary Nexus catchments. Two, turning to the global headwinds arising out of the Middle East conflict, as all of us know, we remain mindful of the macroeconomic issues that may arise, whether it is inflation, higher input costs, et cetera. Currently, happy to note that we are not seeing any slowdown in decision-making on the deal front.
In fact, our long-term leases and strong balance sheet position us very well to navigate this cycle. Consumption trends in April and May have remained healthy with strong, high double-digit growth. Strong, high double-digit growth in April and in the first two weeks of May. The consumption trends are still very strong. March also was in high double digits. We have seen now for almost 10 weeks a very strong growth trend. Occupancy. Our retail occupancy stands at 97%, which is 400 basis points ahead of the market. This is on the back of proactive leasing, high-quality mall infrastructure, prime infield city center locations, and best-in-class management team. Now, coming to our quarterly performance. On the consumption front, growth momentum remained robust.
Building on the strong trajectory witnessed over the previous three quarters, we ended Q4 with robust footfall growth of 8%, and this translated into healthy consumption growth and revenue growth of 19%. Backed by the strong operating momentum, we delivered another solid financial performance with retail NOI growing by 11% year-on-year in Quarter 4 FY 2026. On the back of this performance, we are pleased to declare a distribution of INR 346 crore, translating into INR 2.286. I repeat, INR 2.286 per unit and a year-on-year growth of 14%. Importantly, this marks our 11th consecutive quarter of 100% Distribution payout post-listing, underscoring the stability, resilience, and predictability of our cash flows. I am pleased to share that we have achieved our FY 2026 distribution guidance of INR 9.1 per unit, implying a growth of 9% year-on-year over the previous year.
Since our listing in May 2023, our unitholders have benefited from a combination of steady income growth and capital appreciation, translating into an overall return of more than 75%. More than 75% during the year. Our NAV has increased by 8% to INR 164 per unit. INR 164 per unit. Now, let me walk you through some category-wide strengths. Fashion, which was on a slow track the earlier year, is now growing quite rapidly. It accounts for 50% of our consumption, and it grew by about 12% in this quarter, driven by a sharp uptick in demand for value fashion and ethnic wear, making it the third quarter of strong performance. Fashion growth seems to be back on track. Jewelry recorded its highest-ever quarterly sales since listing, driven by rising gold prices, addition of new jewelry stores across the malls.
Our overall consumption contribution from jewelry has increased by 300 basis points to 7% since March 2025. March 2025 to March 2026, jewelry has increased by 300 basis points in terms of consumption and is now 7% of our portfolio. Three, family entertainment centers, including multiplexes, sustained robust momentum with 18% growth in Quarter 4, FY 2026. You would have seen the results of the cinema operators also yesterday, which were very good indeed. This was aided by blockbuster titles like "Pathaan 2," "Border 2," and many other good Hollywood films as well. Electronics witnessed a 22% growth during the quarter, driven by very strong demand during key promotional events such as Republic Day and end of season sale. Let me now walk you through our leasing and marketing performance. On leasing, we continue to witness robust demand from international and domestic brands.
Supported by this robust demand, we re-leased 9 lakh sq ft during the year at an 18% mark-to-market spread. During the year, we have strategically churned approximately 4 lakh sq ft of space ahead of expiry, achieving healthy spreads reflecting proactive asset management. Coming up in the coming years, lease expiries, we expect about 12 lakh sq ft on an average lease expiries annually over the next four years. So about 12 lakh sq ft of average re-leasing will come up every year over the next four years. In terms of rentals, 45% of our gross rental portfolio will be expiring over the next four years, and this should, with re-leasing, give us a 20% mark-to-market.
From a marketing standpoint, we curated experiential events like Bhajan jamming, which is in today, music concerts, theater performances, across all our malls during the year, augmenting footfalls and generating INR 6 crore revenue. On the digital front, we have installed six anamorphic screens across our malls, and we have partnered with around 120+ brands, generating a revenue of INR 3 crore. Coming to our digital engagement, happy to announce our NexusONE app now has over 1 million users with 1.5 lakh monthly active users and 56% customer repeat rate. NexusONE app remains among India's top performing mall apps with a 4.4 rating on the App Store. Indeed, a great achievement. Now let me walk you through our acquisition strategy and performance of recent acquisitions.
Over the past decade, we have built a robust portfolio through a disciplined third-party asset acquisition-led strategy, focusing on undermanaged or under-leased assets or under-invested assets and unlocking value through our operational expertise. The core strategy remains unchanged, and we will continue to see significant headroom to drive growth through our proven playbook on acquisitions. In addition, as we look ahead, we remain firmly aligned with our vision on doubling our portfolio by 2030. To support this vision, we have further sharpened our acquisition strategy by introducing three strategic pillars during FY 2026. First, we are pursuing strategic tie-ups with reputed developers for under-construction malls. This approach enables us to enter new markets where we currently have no presence, while also strengthening our footprint in existing markets where acquisition opportunities may be limited.
In line with this, we have partnered with Runwal Group to develop a 7 lakh sq ft mall in the MMR region. Second, we are driving strategic expansion within our existing malls as well. During the year, we completed a bolt-on acquisition of Prime, 60,000 sq ft of retail space within Nexus Elante complex in Chandigarh. This demonstrates our ability to unlock incremental value within our current portfolio, and we will continue to pursue such opportunities. Third pillar, in our sponsor pipeline, which provides us with visibility on potential future acquisitions, our sponsor currently holds the South City asset in Kolkata, acquired in 2025, which could present a compelling opportunity over time. Now, coming to our acquisition pipeline. We have built a robust pipeline of eight assets across India, with two assets under due diligence and Diamond Plaza, Kolkata, deal closing underway.
We expect to continue the momentum on acquisitions built over the last year, and we will look to add two to three assets every year to our portfolio. Our LTV stands at 18%. With Diamond Plaza, it will still remain 18%. Cost of debt is at 7.3%, which is 60 basis points lower than March of 2025. This is significantly below our acquisition targets. Supported by a robust acquisition pipeline, strong balance sheet, low leverage, and close to $1 billion of debt headroom, we are well-positioned to drive this phase of our inorganic growth strategy.
Now, turning to the performance of our recently acquired assets. Both Vega City in Bangalore and Nexus MBD Neopolis Mall in Ludhiana, Punjab, witnessed robust tenant growth, growing at 15% after acquisition, and with a footfall of 9%+. So that is really good in terms of the two malls that we acquired. Now, coming to our HR initiatives.
During the year, we launched Arunya, an education program for frontline staff, in strategic collaboration with Medhavi Skills University, and partnered with Welingkar Institute of Management to launch India's first post-graduate program in mall management, reinforcing our leadership and long-term talent vision. Lastly, turning to our unit price performance. Our unit price has appreciated over 50% since our IPO in May of 2023. Our unit holder base has expanded to over 70,000, compared to 24,000 at the time of listing, reflecting both greater breadth and depth of our investor base. Stepping back, FY 2026 delivered record performance, demonstrated resilience across cycles, and validated every pillar of our growth strategy for financial year 2027, for which we are now targeting a DPU growth of 9%. Lastly, summarizing our performance. One, consumption momentum remained robust with double-digit growth in FY 2026, and we expect the momentum to sustain in the coming months.
Delivered strong NOI growth of 13% in FY 2026. Sharpened our inorganic growth strategy with introduction of three new pillars, expected to add two to three assets every year to our portfolio. Leased 4 lakh sq ft ahead of expiry, 45% of our gross rentals expected to expire over the next four years with a 20% mark-to-market potential. We achieved our FY 2026 distribution guidance of INR 9.1 per unit. And we expect to distribute INR 9.8- INR 10 per unit in FY 2027. With that, let us now move on to the Q&A session.
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We will take our first question from the line of Mohit Agrawal from IIFL Capital. Please go ahead.
Yeah. Good evening, everyone, and thanks for the opportunity. My first question is on your guidance. When I look at the 7% NOI growth guidance at midpoint level, can you break that down into what is the contracted growth assumed here? What is the rev share mark-to-market gains and the marketing initiatives? If you could kind of
Sure
give some breakdown. Also, what is the implicit consumption growth that you assume here for the 7% NOI number?
Okay. Pratik, you want to answer this?
Yeah. Mohit, on the NOI guidance, I think the way we kind of break it down is at least 90% of, because it is like 10%, 11% of our rentals that have that mark-to-market. The balance rentals typically would grow at about 4%- 4.5%, which is the annual escalations of annually compounded 15% every three years. That gives you about 4.5% growth. We get typically a 20% mark-to-market on an average about 10% rentals expiring every year. So that gives you about 2% growth. That takes it towards 6.5%. Then depending on the consumption growth that we forecast, we get the balance growth, which takes it closer or just above 7% there. Does that answer on the NOI front?
On the consumption front, I think the assumption is about 8% standard growth, which is what we have assumed or what we have achieved in the past, is what we will project for the future as well. So 8% consumption growth is what we are planning in FY 2027.
Yeah. Pratik, but then have you also considered the impact of the acquisitions? Because the headline 7% number seems to be considering that the consumption growth has been so strong, it looks to be a little bit of are we being conservative here? Do you think that we could see surprises on this one on the positive side?
Yeah. First of all, this is organic, no acquisition built in, Dalip. To answer your question honestly, yes. This is a year where all of us have to be a little cautious, I would imagine, because of whatever is happening around the world. Like I said, April may have been very good, and we do hope that this kind of a consumption trend will continue. But you are right, we have actually been a little conservative. The original model is around 8% or 9%, and the intent would still be to ballpark get into those numbers.
Okay. That explains. The second question is on your like-for-like 15% for fourth quarter and 9% for FY 2026. Could you give that number if you exclude the non-rev share segments like jewelry or maybe some part of FEC? Sorry, electronic, sorry. Where would that number, after excluding those segments be?
12%.
12% for fourth quarter, and for 2026?
About-
14%.
Four-
Maybe.
Maybe.
Like-for-like.
Like-for-like.
Like-for-like.
Yeah, that would be around, I would imagine.
8%.
7% or 8%.
Yes.
Okay, perfect. My last question is on Select Citywalk. Over the last three, four years, the rental growth has been sub 5% per annum. If you could explain how to understand that. Has that mall achieved some sort of a maturity or what kind of initiatives you are taking to speed up the rental growth from here on?
I will request Nirzar to answer this question. Nirzar.
Hi, Mohit. Nirzar here. On the rental growth in Select Citywalk, the rentals were very high, so we changed the loading. When you look at the per square foot rentals, they show 3%, 4% on the loaded area. If you actually take it on the carpet area, they have increased almost 8%, 9%. We are still getting very healthy spread in terms of the overall rental outflow, and that is contributing to the NOI growth as well.
Yeah. I think the other thing is in Select Citywalk, there are a reasonable number of international brands which are on revenue share. It is not just the MG, the rev share also goes up as they grow. What we are seeing now is some resurgence of brands like Zara and H&M and so on and so forth. My sense is that Select Citywalk also will perform better in FY 2027.
In terms of rental improvement?
Overall, MG plus rev share.
Okay, great. Thanks a lot. Those are my questions.
Thank you.
Thank you.
Thank you. We will take our next question from the line of Sumit Kumar from JM Financial. Please go ahead.
Hi. Good evening, sirs. Thanks for the opportunity. My first question is on the follow-up to the last one. Jewelry as a category has been doing well for the last two quarters. Does that translate into rental growth, or is it dependent on expiry and then a mark-to-market or a re-leasing spread on that?
Jewelry now is about 7% of our business in quarter four. Two questions you asked, what happens to rentals? Just to give you a sense, typical rentals on, let us say, fashion brands is anywhere between INR 140- INR 160 a square foot. Whereas for jewelry it is INR 280- INR 300 a square foot. That is the kind of uptake that you see once you re-lease it. Secondly, unlike fashion, which occupies a lot of space, jewelry does not occupy much space. Even today, maybe about 2%- 2.5% of our GLA would be jewelry accounting for 7%, and accounting for per square foot rentals which are twice of the fashion average and probably close to three times our overall average.
Sumit, the other point is, I think when we focus on some of these high-value categories, these categories not only enhance the overall mall sales, but they also improve the quality of the footfalls. They strengthen the overall category mix. They also elevate the overall look and feel of the mall. All of this actually creates a positive rub-off effect on some of the other categories as well. We witnessed some of that on Akshaya Tritiya as well. When we compare Akshaya Tritiya this year versus Akshaya Tritiya last year, we saw that with the increase in salience of jewelry brands in our portfolio, that actually had a rub-off effect on some of the other categories. The share of growth on that day for some of the other categories was as high as 54%.
That was the thesis of increasing some of these high-value categories, and it just kind of got validated when we looked at Akshaya Tritiya sales.
Yeah. The fact is that from a consumer perspective, if there is no jewelry in a mall on occasions like Akshaya Tritiya or if you are shopping for a wedding or for any other occasion, you would probably go to the high street and buy. Hence the mall would lose that footfall, not just for jewelry but for all products and categories. That is what we have seen, that even on Akshaya Tritiya, the growth without jewelry was also upwards of 45%. What it has done is brought in better quality footfalls. People who obviously come to buy gold but also want to then spend time, maybe buy some stuff for the kids, eat a little bit. F&B went through the roof that day, and so on and so forth. I think there is a positive rub-off.
The immediate rub-off, like I said, is the fact that the trading densities are 10 times of what it is for fashion. Rentals are at least twice, if not 2.5 times. The fact that you are getting exceptionally high number of footfalls because if you have the full line of jewelry, which we have, for example, now in Nexus Elante Mall, we have that in Seawood s, then the Akshaya Tritiya customer is very happy to come to the mall and spend the day there.
Sure, sir. Fair enough. My second question will be on the Kolkata acquisition, Diamond Plaza. What was the strategic rationale of doing this acquisition? Because this asset is on the smaller side, is it entry to the market or anything else that you have looked at?
Smaller size?
Relatively smaller.
Which one?
Diamond.
Oh, Diamond. No, fair question. I think if you look at East, our presence has been very limited. We've had one mall, very well-performing mall in Bhubaneswar. Otherwise, our footprint in the East, like most big mall operators, has been very weak. As you know, Blackstone bought the South City Mall, which is a best operating asset. Diamond Plaza, the DD is done, and hopefully that will come into the fold. So we're trying to build a portfolio. Sometimes what happens, and this is a very well-performing mall, while it is small, is that when you're looking at a portfolio in a city, there's only that much that you can buy, and this is one of the assets that was doing well, so we certainly did buy it.
We're also looking at the other cities as well in the eastern part because there is a lot of growth happening in the East. Over the next three to five years, if we have to double our portfolio and our business, I think we'll have to have a strong presence in the East as well.
I think, Sumit, more from an investment highlight standpoint, right. I think Kolkata has limited supply of retail space per capita, and that's lowest among some of the major metropolitan markets that are there in India. From a market standpoint, there isn't good retail space. I think second is the location of this mall. It was pretty centric in northern Kolkata and in a dense residential catchment area, which actually worked. I think there is enough upside here possible. It seems to be not a very well-managed mall, and therefore there's upside potential possible, which is typically the Nexus way of acquiring and then turning around a mall. So I think while we come up with more specifics once we close the transaction in quarter 2, I think this is what we can share at this point of time.
Sure, Pratik. Thank you and all the best.
Thank you.
These are my questions. Thanks.
Thank you.
Thank you. Before we take the next question, would like to remind participants, to ask a question, please press star and one on your phone. Next question is from the line of Parvez Qazi from Nuvama Group. Please go ahead.
Hi. Good evening. Thanks for the great set of numbers. A couple of questions from my side first. You have obviously delivered strong consumption growth both in Q4 as well as in FY 2026. You gave a category-wise description of that. Looking at other way, what would have been, let us say, contribution of footfall growth versus higher trading density which led to this kind of a consumption?
Okay. Footfall growth in the quarter, if you see the numbers, around 7% odd. I am now looking at the overall number. Growth has been around 14%, 15% in terms of consumption. Two things. One is that, yes, footfall growth has helped, especially because I think a lot of these footfalls were movie footfalls. That does lead to better consumption of entertainment. On the other hand, I think higher value categories like jewelry, like electronics, beauty, those are the categories that are helping us build the trading density as well. Like I said, jewelry, for example, has anywhere between INR 16,000- INR 20,000 TD per square foot. Fashion would have around INR 2,000 a square foot. TD also gets built, area required is more. Yes, the footfall growth, my sense is a lot of it actually did come from better performing cinemas.
That obviously helps the rest of the categories as well.
You said 7% was footfall. You gave another number of 14%, 15%. What was that? That was trading density or?
Consumption.
Consumption. Okay. Sure. The second question is, you said April, May have been strong.
Yeah
Just like March was.
Yes.
Has there been any change in consumption patterns in terms of categories in, let's say April, May, compared to, let's say, any time in FY 2026?
April, because of Akshaya Tritiya, obviously jewelry did extremely well, and that contributed to the growth. But Akshaya Tritiya growth also, as Pratik pointed out earlier, half of the growth came from jewelry, the other half came from all the other categories. All the other categories, if you exclude jewelry, the growth was 40%. So it's across categories that there has been a growth. Number two, second part of your question was around.
No, I mean, which category did well in April and May?
In May, for example, there is no jewelry upside, in the sense that, yes, we will have more stores, so there will be some upside, but there is no Akshaya Tritiya, and yet, in the first 15 days, and as you know, through our daily reporting system, we get sales every day. I think as of yesterday, we are about high double-digit growth in May as well. Without jewelry actually contributing very significantly to that growth. My sense is that April, certainly, some of it was the fact that we had more stores, et cetera. And of course, the fact that Dhurandhar 2 did extremely well in April as well. Yeah. In May, bar a couple of Hollywood movies, I don't think anything significant has happened in the first few weeks. But yeah, overall consumption still remains quite strong.
Also, there is another point of view, and maybe you will have some sense of it from other people as well, is that, there is a large consumption improvement in the domestic market, primarily on account of what we believe, and it's hypothesis, maybe we are wrong, is that, this INR 97,000 crore of international travel and holidays which have not happened at all because of various problems and the fact that airfares have also increased, et cetera. Out of that INR 97,000 crore, I would have imagined that some of it would have gone into investments. But looking at the stock market again, not so sure how much of that would have gone there. A large part of it, and I don't have a firm number, but I do believe that a substantial part of that is also coming to consumption, especially in malls.
Imagine a family with young kids who had planned to go overseas on a holiday, but because of the cost, et cetera, unable to do it. What would they do? On a weekend you would take your kids out, they would not be sitting at home. Holidays have started, so what do you do? You take them to the mall, and you will eat and you will spend some time. To my mind, I think this is where the share of wallet of the malls has actually improved in terms of overall consumption.
Sure. Last question, we have a very strong acquisition pipeline. I believe yields in the market have already started rising. From a timing perspective, what is the thought process? Do we wait to get maybe better cap rate at the time of acquisition, or we still go ahead? What is the thought process towards that?
Parvez, I think the way we have also called this out in the past, we typically like to maintain at least 150- 200 basis points spread between the cap rates that we trade at versus the cap rates that we acquire. Historically, whatever we have acquired has been in that range of 9%, 9.5%, closer to 10%. I think that is how we will kind of also look at deals going forward. Obviously, with the interest cost kind of going up, we will be very prudent at what cap rates we acquire. But yeah, I think we have now got multiple other levers apart from just third-party acquisitions that we are kind of looking at. I think as we add some of those levers into the portfolio, we will see the funnel of assets coming into the portfolio being much, much larger going ahead.
Sure. Thanks, Pratik. Over to you.
Thanks, Parvez. Thank you.
We will take our next question from the line of Gaurav Khandelwal from JPMorgan. Please go ahead.
Hi. Thanks for taking my question. Good evening. I have got a couple of follow-ups on the Kolkata acquisition. One, on the Diamond Plaza acquisition, what is the kind of acquisition cap rate that we are looking at? We paid INR 350 crore, but where is the NOI roughly? That is number one. Number two, on the same asset, let us say we are able to close it by first half of the year. How much upside would it imply to our NOI DPU for the full year?
Gaurav, we have not still closed the transaction. It is still in the process. It will take a few more months to close it. Hence we will not be able to kind of get to the exact cap rates and upside. That will possibly depend on when the asset comes in and what is the balance period that the asset remains with us in the year. But directionally, what we have spoken about, it being acquired at a purchase consideration of close to about INR 347.5 crore.
The cap rate will be similar to the range that I had indicated earlier. It will be in those kind of cap rate. So expect it to be in that range, but the exact nuances, the details around what will be the DPU accretion, et cetera, will probably come out when we actually close the transaction. We will put up a presentation on it.
Got it. Secondly, can I check, is there an update on the South City Mall asset as well in terms of acquisition timeline?
Not at this point of time. But yeah, I think it should, at some point of time, come into our portfolio. But there isn't a firm timeline there.
I think the only update is that a lot of issues that were there, including Sri Lanka property, Dubai, et cetera, are getting sorted out. I think that's the good news. Exactly when this will happen, we'll just have to wait and see.
Got it. But do we have a sense if that closes in FY 2027 itself, or could it extend to FY 2028?
No directional sense to.
I think another couple of months we will be able to tell you and give you a better fix.
Cool. Okay. All right. Thank you so much. Those are all my questions.
Thank you. Next question is from the line of Girish Choudhary from Avendus Spark. Please go ahead.
Yeah, hi. Thanks for the opportunity. Firstly, on the re-leasing spreads, we have generally seen a healthy 18%- 20%. Also, if I try to look for the expiries coming in, you are more or less guiding for that. I just wanted to understand from your conversation with tenants, do you think the current spreads are structurally sustainable, or are we approaching affordability thresholds for certain categories?
Hi. Nirzar here. Girish. I think the spreads that we will sustain that. If you see our track record in the past, we have kind of sustained that including tough years through COVID. Currently, we see no pressure in the conversations. Retailers are still upbeat in terms of off take expansion of spaces. The portfolio is also very well leased at 97%+ . So, that also helps us to kind of manage the demand better. So no pressure there, and we are confident of maintaining similar spreads.
Girish, if you look at slide 16 that we have kind of called out, saying that when you look at supply, there is not near term ready supply in our market, especially in the primary catchment that we are present in. A lot of the supply that is coming, one, it is back-ended and expected to come only in 2028. That also is limited to about three or four cities. So three, four cities would have that, not in our primary catchment, but the cities are large enough to have it. At the same time, a lot of it is going to come only in 2028. So I think we are kind of pretty confident that we can maintain this 20% mark-to-market run rate going ahead as well.
Got it. That is useful. Secondly, on the strategic churn and the portfolio optimization, I see that you have already re-leased around 0.4 million sq ft ahead of expiry. I just want to understand at the portfolio level, how should we see in terms of identifying more such opportunities, and can this become a slightly larger part of the NOI growth which is not baked in?
Hi, Girish. Nirzar here. I think when we build in our AOPs, we factor in some of this. Even last year with what we did in terms of the 0.4 and the overall 1 million activity. Our natural expiries were just about 600,000, and we did 1 million. It is kind of built into our plan based on timing, which particular mall needs attention. We are kind of creating those opportunities in the coming year as well. This year we are aiming higher than that, looking at the expiry schedules. In fact, some very interesting new brands that we are bringing to each of our respective malls in this plan.
Girish, I think typically, whatever is the expiry, natural expiry that comes up the area, you can kind of safely assume that you will typically do about 20%-25% more than what that natural expiry is. I think on an overall basis, we end up doing anywhere between 1.3- 1.5, depending on the year.
Got it. Yeah. Those were my questions. Thank you, and all the very best.
Thanks.
Thank you. Next question is from Jatin from Bank of America. Please go ahead.
Hi. Good evening. Thanks for the opportunity. Wanted to check with you on your plans for your debt mix for the next year. Last quarter, we were at 52% floating. That has actually gone up to 59%. With some expectations on the street that rates might go up, what is the plan on this front, and how much in your current DPU guidance of 9%, how much increase in interest cost are you taking for FY 2027?
If you look at floating has gone up because of Bajaj Finance loan that we had taken. We have taken a top-up to repay the commercial papers that we were carrying. Hence, the floating has gone up. If you look at the interest rates, they have come down to around 7.3%, and we are saving around INR 25 crore-INR 30 crore annually. So the annual budget that we have prepared is based on the 7.5% rate of interest.
Understood. Got it. Very clear. Finally, a bookkeeping one. For the full year, how much was the LFL NOI growth? Thank you.
For 2026? FY 2026?
For 2026. Yeah.
7%, yeah.
Okay, sure. Thank you so much. All the best.
Yeah.
Thank you. Next question is from the line of Siddharth Shah from Nuvama. Please go ahead. I am sorry, you are sounding muffled, Siddharth. No. No, it is still muffled, Siddharth. I think your network coverage is not proper.
No, Siddharth, we cannot hear you. Very muffled voice. No, Siddharth.
No, not really.
Maybe, Siddharth, you want to reach out to us separately because the voice is really muffled. We really can't hear you.
Yeah. That would work. Sure.
Thank you. That was the last question of our question and answer session. As there are no further questions, on behalf of Nexus Select Trust, that concludes this conference. Thank you for joining us, and you may now disconnect your line.
Thank you.
Thank you.
Thank you.