Publicly listed REITs and InvITs in India have distributed over ₹30,000 crore to unitholders since their inception over 5 and 7 years, respectively, according to the Indian REITs Association and Bharat InvITs Association.

As per the IRA, the Indian REIT market has over ₹1,40,000 crore in gross Assets Under Management (AUM), a market capitalisation of over ₹85,000 crore and a portfolio of 115 million square feet of Grade A office and retail space nationwide.

In five years, REITs have distributed more than ₹17,000 crore and have raised over ₹25,900 crore of equity capital through primary issuances, stated the association. They also said that India currently has around 400 million square feet of REIT-able office space and 70 million square feet of REIT-able retail space, out of which only 100 million square feet and 10 million square feet, respectively, are part of Indian REITs.

‘Growth opportunity’

A spokesperson from Indian Reits Association (IRA) said, “Currently, REITs represent 14 per cent of the total market capitalisation of the Indian real estate portfolio, with a current base of 2,30,000 unitholders, pointing at a huge opportunity for growth.”

Currently, India has four publicly listed and 14 privately listed InvITs. Cumulatively, they manage assets worth ₹5 lakh crore and have raised ₹1.1 lakh crore in equity since 2019. The four publicly listed InvITs have a combined market capitalisation of ₹27,500 crore and have over 1.7 lakh unit holders. BIA also estimated that InvITs have the potential of adding over ₹20 lakh crore (BIA estimates) in their AUM over the next decade.

A spokesperson from Bharat InvITs Association (BIA) said, “Given the government’s focus on massive infrastructure projects, the sector is poised to grow at rapid pace in the coming years. With the value proposition InvITs offer, they provide an excellent opportunity for all investor classes to tap into this segment.”

Additionally, BIA and IRA have been collaborating with regulators and government authorities to secure classification as equity/equity-like instruments to bolster their liquidity on stock exchanges. “We are proactively collaborating with governmental authorities to secure classification as equities,” said an IRA spokesperson. “This classification would facilitate index inclusion, attract passive flows into REITs and boost liquidity, stimulating increased trading activity. Moreover, categorising REITs as equities would enable their inclusion in ETFs or equity mutual funds, fostering greater liquidity and broader acceptance of this investment instrument.”

(Inputs by bl intern Vidushi Nautiyal)