Distribution yield

The distribution a property trust pays as a percentage of its market value.

A trust distributing ₹240 crore against a ₹3,700 crore market value yields 6.49%, and with ₹265 crore of funds from operations it's paying out about 91% of them.

Indian trusts are required to distribute the large majority of their distributable cash flow, which makes the yield the primary valuation measure and links it directly to funds from operations.

Compare it with the government bond yield. That spread compensates for the risk that rents fall and for the illiquidity of the underlying property.

Growth in the distribution comes from rent escalations and from acquisitions. Only the first is free.