Page 2 - Reits

REITs, InvITs mobilise Rs 1.3 trillion in past four years: RBI data

Investment vehicles for realty and infrastructure sectors -- REITs and InvITs -- have garnered Rs 1.3 lakh crore in the past four years till March-end, and are expected to facilitate more pooled funds, Reserve Bank said in a report. Experts and stakeholders are of the view that with India growing at a fast pace, REITs and InvITs are emerging as alternative investment instruments, especially for high net-worth individuals. "India has been a late adopter of real estate investment trusts (REITs) and infrastructure investment trusts (InvITs). However, the market is flourishing - REITs and InvITs have mobilised Rs 1.3 lakh crore since 2019-20 (up to March 2024)," said an article on 'State of Economy' published in the RBI's April Bulletin. March witnessed the listing of an InvIT, which raised Rs 2,500 crore through a public issue, attracting substantial interest from foreign investors. The article noted that market regulator SEBI has progressively reduced the minimum investment size and

Fundraise by InvITs, REITs surges multi-fold to Rs 17,116 cr in FY24

Investor enthusiasm towards InvITs and REITs is on the rise, with fundraising through these routes reaching Rs 17,116 crore in 2023-24, a 14-fold year-on-year surge fuelled by the prospect of stable returns. Going ahead, the outlook for infrastructure investment trusts (InvITs) and real estate investment trusts (REITs) in terms of fundraising for the current fiscal FY25 is very optimistic, industry experts said. "After Sebi's amendments to the SM (small and medium) REITs regulations last month, we are poised for a transformative shift. The Indian fractional ownership market, set to evolve into SM REITs, is projected to grow from USD 500 million to over USD 5 billion in AUM by 2030, indicating a significant expansion and bright prospects for SM REITs," WiseX CEO Aryaman Vir said. Moreover, the road sector is likely to be a major beneficiary, likely attracting 75 per cent of the new inflows, thanks to a robust pipeline of assets ready for monetisation and a strong pace of infrastructu

Selecting a REIT: Factor in capital gains and dividend payouts

The Indian REITs Association, a newly formed umbrella body, has meanwhile requested Sebi to classify REITs as equities and petitioned RBI to allow banks to lend to REITs

Sebi mandates registration of index providers under regulatory fold

Mandates registration of index providers managing 'significant indices' based on securities listed in India

Rs 4K cr and rising: How fractional ownerships are revolutionising realty

Market regulator Sebi's decision to allow the setting up of small and medium Real Estate Investment Trusts (REITs) is expected to regulate and fuel growth in this segment

Mindspace REIT Q3 results: Profit up 16% at Rs 147 cr, income at Rs 610 cr

Mindspace Business Parks REIT on Monday reported a 16 per cent increase in its consolidated net profit to Rs 146.8 crore for the latest December quarter and announced distribution of Rs 285 crore to unitholders, mainly in the form of dividends. Its net profit stood at Rs 126.5 crore in the year-ago period. The total income rose to Rs 610.8 crore in the October-December period of this fiscal from Rs 560.4 crore a year ago, according to a regulatory filing. The company also announced a distribution of Rs 4.80 per unit aggregating to Rs 284.6 crore, which comprises a dividend of Rs 4.29 per unit totalling Rs 254.4 crore, interest of Rs 0.50 per unit aggregating to Rs 29.7 crore and other income of Rs 0.01 per unit, aggregating to Rs 60 lakh. The Board of Directors of K Raheja Corp Investment Managers Pvt Ltd, manager to Mindspace Business Parks REIT, approved the proposed acquisition and term sheet to be entered in relation to the acquisition of certain units measuring leasable area o

REITs, InvITs see growth; fund mobilisation rises to Rs 11,474 cr in 2023

REITs and InvITs have gained popularity as preferred investment options, with fundraising, through the route, surging 10-fold year-on-year to Rs 11,474 crore in 2023, supported by measures taken by regulator Sebi and attractive returns offered by the instruments. Going ahead, fund mobilisation by REITs (real estate investment trusts) and InvITs (infrastructure investment trusts) is poised for significant growth in 2024, driven by several key factors, including anticipation of rate cuts and introduction of a range of policies aimed at encouraging investments like tax incentives and relaxed investment norms, Claravest Technologies co-founder Manaki Parulekar said. "This year, we are likely to see interest rates decrease in the first half of 2024 due to the expected drop in inflation. These conditions are favourable for investors who are looking to invest in long-term opportunities, such as REITs and InvITs," he added. According to data compiled by Prime Database.com, REITs and InvITs

Year ender 2023: 10 important regulatory changes that took place in India

2023 was a busy year for regulators like the Reserve Bank of India and the Securities and Exchange Board of India. Here are the 10 key changes on the regulatory front

20% stake worth Rs 6,171 crore in Embassy REIT sold through block deals

The prominent buyers included HDFC Mutual Fund, Fidelity Funds South East Asia and ICICI Prudential Mutual Fund, among others

Sebi to frame rules for REITs, InvITs issuing subordinate units to sponsors

Capital markets regulator Sebi is looking to come out with a framework for the issuance of subordinate units by REITs and InvITs to sponsors and their associates. Additionally, the regulator has proposed a framework for unit-based employee benefits (UBEB) in the context of REITs (real estate investment trusts) and InvITs (infrastructure investment trusts). The Securities and Exchange Board of India (Sebi) has sought comments from the public till December 29 on the proposals. Under the proposed framework, subordinate units can be issued only to the sponsor, its associates and sponsor group, such units should carry only inferior voting as compared to ordinary units and the units can be issued to the eligible entities in the initial offer or in any offering subsequent to the initial offer, Sebi said in its consultation paper. It further suggested that subordinate units can only be transferred inter-se amongst the sponsor entities. "Any issuance of subordinate units post initial offer

Sebi lays down framework for calculation of Net Distributable Cash Flows

To promote ease of doing business, capital markets regulator Sebi on Wednesday decided to standardise the framework for calculation of available net distributable cash flows by REITs, InvITs and their respective holding companies. The new framework will be applicable from April 1, 2024, the Securities and Exchange Board of India (Sebi) said in two separate circulars. Under the rules, the Net Distributable Cash Flow (NDCF) is computed at the level of real estate investment trusts (REITs), and infrastructure investment trusts (InvITs) and their holding companies (HoldCo) or special purpose vehicles (SPVs). Further, the minimum distribution should be 90 per cent of the NDFC at the Trust level as well as the HoldCo/SPV level. This is subject to applicable provisions in the Companies Act or the Limited Liability Partnership Act. Sebi said that the option to retain 10 per cent distribution needs to be computed by taking together the retention done at SPV level and Trust level. "Further,

With retail demand and investor interest up, India set to get bigger malls

High interest from investors, along with comfortable balance sheets, is expected to keep credit risk profiles of mall owners stable, says Crisil

Sebi eases access to unclaimed funds in REITs, InvITs, debt securities

Capital markets regulator Sebi on Wednesday came out with detailed procedures for dealing with unclaimed funds of investors lying with entities having listed non-convertible securities, REITs and InvITs. Also, the regulator has put in place a manner of claiming such unclaimed amounts by investors. The new framework will come into effect from March 1, 2024, the Securities and Exchange Board of India (Sebi) said in three separate circulars. The move is aimed at prescribing a uniform process of claim for such unclaimed funds in a streamlined manner for the ease and convenience of investors. This came after the board of Sebi in September approved amendments to rules about the IPEF (Investor Protection and Education Fund) disclosure, real estate investment trusts (REITs), and infrastructure investment trusts (InvITs). Going by circulars, Sebi has defined the manner of handling the unclaimed amounts lying with REITs, InvITs, and in the escrow accounts of the listed entities (which are n

REITs, InvITs collect Rs 18,658 cr in Apr-Sep on robust infra demand

Strong demand for infrastructure investment, attractive returns, and favourable government policies have pushed fund mobilization through listed REITs and InvITs to Rs 18,658 crore in the April-September period of the current fiscal. This came following a fund collection of Rs 2,596 crore through listed Infrastructure Investment Trusts (InvITs) in the entire 2022-23, although the amount mopped up through listed Real Estate Investment Trusts (REITs) was nil, data with the Securities and Exchange Board of India (Sebi) showed. Going forward, experts believe that trends seen in REITs and InvITs will continue in the second half of the year too. "The fresh savings will continue similarly as has happened in the last six months, and the investments will continue to be towards InvITs as both the central government and the state governments continue to focus more on infrastructure development," Himanshu Kohli, Co-founder of Client Associates, said. Hence, the trends you have seen in REITs an

Sebi issues framework for REITs, InvITs to exercise board nomination rights

Markets regulator Sebi on Monday issued the framework to exercise board nomination rights by eligible unitholders of Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs). At its board meeting on June 28, the board of Sebi approved introducing nomination rights to unitholders of REITs and InvITs. An eligible unitholder means a unitholder that has 10 per cent or more of the total outstanding units of a REIT or InvIT, either individually or collectively. The Securities and Exchange Board of India (Sebi) has issued the framework to exercise board nomination rights by the eligible unitholders, according to two separate but similarly-worded circulars. The regulator said the manager of a REIT or InvIT should review whether the eligible unitholders who have exercised the board nomination right, continue to have/hold the required number of units of the REIT or InvIT concerned. The review has to be done within 10 days from the end of each calendar month. In t

4 listed REITs join hands to form industry body to advocate interests

Four listed real estate investment trusts have joined hands to form an industry body that will advocate the interests of businesses as well as investors. The Indian REITs Association, a non-profit group formed under the guidance of the Securities and Exchange Board of India (Sebi) and the Ministry of Finance, will also work on ways to enable further growth of Real Estate Investment Trusts (REITs). Brookfield India Real Estate Trust, Embassy Office Parks REIT, Mindspace Business Parks REIT, and Nexus Select Trust are the founding members of the Indian REITs Association (IRA). The journey of REITs in India commenced with the introduction of regulatory guidelines in 2014 and culminated in the public launch of REITs in 2019, with Embassy REIT's listing. Following this, two more REITs were listed on the Indian exchanges -- Mindspace Business Parks REIT in 2020 and Brookfield India Real Estate Trust, in 2021. In May 2023, India's first retail REIT, Nexus Select Trust, was listed. The ..

Market regulator Sebi to bring follow-on offer rules for REITs, InvITs

To develop the market for emerging investment instruments, Sebi is looking to bring in norms for follow-on offers by real estate investment trusts (REITs) and infrastructure investment trusts (InvITs). REITs and InvITs were introduced in India to provide investors with an opportunity to gain exposure to real estate and infrastructure projects respectively, with diversification of risks through pooling arrangements. Generally, REITs invest majorly in completed and rent-generating real estate assets. Privately placed InvITs can invest in under-construction assets as well as completed and revenue-generating assets and public InvITs can invest majorly in completed and revenue-generating assets. "Taking cognizance of the potential of REITs and InvITs in driving the future of Indian infrastructure, Sebi would endeavour to further develop the market for REITs and InvITs in the coming years through policy measures including considering bringing in norms for follow-on offers by REITs and ..

REITs will continue to have strong potential in India in future: Experts

The real estate investment trusts (REITs) in India will continue to have "huge potential" in the future as these may expand to other asset classes such as industrial, data centre, hospitality, healthcare and education, experts said. REITs are companies that own and operate income-producing real estate, and their shares are traded on stock exchanges. "REITs in India are still at their early stages as compared to other regional markets. India's REIT market capitalisation is less than 10 per cent of that of countries like the US and Singapore and other countries in the Asia-Pacific region. "Considering the size of the Indian office market, there exists a huge potential for more REITs and expansion of current REITs," Colliers India MD (Capital Markets and Investment Services) Piyush Gupta said. Embassy Office Parks REIT Deputy Chief Financial Officer Abhishek Agarwal recently said the company remained optimistic about the office REIT market and was looking for expansion. The company w

Office space emerging as darling of private equity investors in India

Office space is getting the lion's share of investments by PE investors into the sector, experts suggest this trend is likely to continue in the coming months

Sebi gives norms for compliance with 25% minimum public holding rules

Markets regulator Sebi on Tuesday provided methods such as an offer for-sale mechanism, rights issue and issuance of bonuses to unitholders of REITs and InvITs to achieve compliance with the 25 per cent minimum public holding requirement. The rule mandates that any listed REIT (Real Estate Investment Trust) or InvIT (infrastructure investment trust), which has public unitholding below 25 per cent, will have to increase its public unitholding to at least 25 per cent within a period of three years from the date of listing of units. To facilitate REITs and InvITs to achieve minimum public unitholding compliance, Sebi said that managers of these trusts will have to adopt any method suggested by the regulator. Methods include the issuance of units to the public through an offer document, offer for sale (OFS) of units held by the sponsor, manager and their associates to the public through an offer document and OFS of units through the stock exchange mechanism for compliance with the ...