Real Estate Investment Trusts (REITs) have a long history in financial markets across the world. In India, SEBI introduced regulations specific to REITs back in 2014. Today REITs are no longer alien to seasoned investors. Investors invest in a REIT which in turn invests in income-generating real estate properties – typically commercial property such as office spaces and malls. Participating investors can even buy or sell units of a REIT on the stock exchanges.
So far, the regulator’s focus had been on large REITs with minimum real estate assets of at least Rs 500 crore. Yet, there has been a growing interest – particularly among HNIs – in small enterprises that invest predominantly in luxury properties and holiday homes. In the last five years, several online ventures called Fractional Ownership Platforms (FOPs) have come up, allowing HNIs and retail investors to participate in such real estate investments with minimum investments ranging between Rs. 10 lakhs and Rs. 25 lakhs.
Please click here to read the full article by Varun Sriram and Varsha Srinivasan, published in The Economic Times.
Varsha’s practice in JSA focuses on M&A, banking & finance, and general corporate.