India is on the verge of getting its first Real Estate Investment Trust (REIT) of retail assets soon as the developers and institutional investors plan to earn revenue from their commercial spaces in the shopping malls.
According to the leading property consultant JLL, REIT, which already is a popular instrument worldwide, was introduced in the country some years back to attract investments in the real estate sector by enhancing the earning efficacy of the rent-yielding assets. It has helped to enable retail participation and unlock the huge value of different real estate assets.
In the present scenario, there exist three listed REITs on Indian stock exchanges: namely Brookfield India Real Estate Trust, Mindspace Business Parks REIT, and Embassy Office Parks REIT. However, all operate on leased commercial assets.
The recent report highlighted the fact that institutional investments have been on a steady rise in the retail sector since 2021 with investments of $862 million made, apart from the portfolio deals. Numerous foreign investments in the retail industry in India, have been through the greenfield development platforms or buying of stakes in existing assets.