In the emerging scenario in the country's real estate sector where REITs have become realty, rent-yielding assets spread over massive 1.73 billion sq.ft commands biz potentials worth $121 billion. Out of these assets, rent-generating office inventory is spread over 537 million sq.ft valued in excess of $70 billion or worth more than 50% of valuation of total assets, claimed KPMG, NAREDCO, Hariani & Co. and Knight Frank, in a recent report. The reports further added that apart from offices, there are other properties like warehousing, retail malls, shopping centers and school buildings that have turned potential REIT-able assets. In the official segment, around 537 million sq.ft and 75 million sq.ft, respectively, is REIT-able area located in the top seven property markets including Mumbai, National Capital Region, Bengaluru, Chennai, Hyderabad, Kolkata and Pune. Similarly, in regard to warehousing space, the all-India REIT-able assets estimate is around 1.12 billion sq.ft. Indian REITs will help to split the bill on real estate investments. Developers divesting through REITs can get in and out of developments quickly and investors can also make lower ticket investments in property through REITs, said Founding & Managing Partner, Hariani & Co., Ameet Hariani. According to the Chief Economist & National Director - Research, Knight Frank India, Samantak Das, REITs have the potential to transform the Indian real estate sector. A cursory look may identify benefits such as the improving fund availability for the sector and a new investment vehicle for the public, further probing would highlight the immense gains that would occur on account of elevated transparency and governance standards.
