India’s market for Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs) has expanded rapidly in recent years, reflecting growing investor confidence and regulatory support.
The country’s first REIT, Embassy Office Parks REIT, debuted in 2019 with an initial public offering worth about ₹47.5 billion. The offering attracted strong demand, being subscribed more than 2.5 times, signalling investor appetite for this relatively new asset class in India. In the years that followed, three more large REITs entered the market: Mindspace Business Parks REIT in 2020, Brookfield India Real Estate Trust in 2021, and Nexus Select Trust in 2023. A fifth REIT, Knowledge Realty Trust, is expected to list in the second half of 2025.
The InvIT market has evolved along a similar path. After IRB Infrastructure Trust launched the country’s first InvIT in 2017, other infrastructure sponsors followed. These include Indigrid Trust in 2017, PowerGrid Infrastructure InvIT in 2021, Indus InvIT in 2024, and Capital Infra Trust earlier this year.
Regulators have played a key role in encouraging the growth of these investment vehicles. India’s market regulator, the Securities and Exchange Board of India (SEBI), along with the Ministry of Finance, has gradually refined the regulatory framework to address industry concerns. One major change was the reduction in minimum investment requirements, allowing investors to purchase a single unit in listed REITs or InvITs. Units typically trade in the range of ₹100 to ₹400 for REITs and ₹50 to ₹150 for InvITs.
Tax rules were also clarified in 2020 after the abolition of the dividend distribution tax. While interest and rental income distributed by REITs and InvITs remain taxable for investors, certain dividends from underlying entities and debt amortisation payouts are tax-exempt, helping maintain attractive post-tax yields. The government has also allowed large domestic institutions, including the Employees’ Provident Fund Organisation, to allocate part of their portfolios to these trusts.
In March 2024, SEBI introduced a framework for Small and Medium REITs to regulate fractional property ownership platforms. These smaller trusts allow multiple schemes holding properties worth ₹500 million to ₹5 billion, each required to invest mainly in completed, income-generating assets and distribute income quarterly.
Today, India has four listed REITs with a combined gross asset value exceeding ₹1.6 trillion. Together they own about 129 million square feet of Grade-A commercial property across major cities. Their combined market capitalisation is close to ₹1 trillion, reflecting the growing importance of REITs as an investment option.
