REIT await Rs. 1.25-tr listing in India

According to JLL India estimates, as much as 229 million sq.ft of office space in India is compliant with Real Estate Investment Trusts (REIT) and even if half of this space were to get listed in the next few years, the total REIT listing could be of Rs. 1.25 trillion. Renowned private equity funds such as Blackstone, Brookfield, Singapore's GIC and the Canada Pension Plan Investment Board (CPPIB) are expected to be the first movers in this space. They are also most likely to be successful in this endeavor, given the fact that they have a good portfolio of superior Grade A office spaces in tier-I cities. In the Budget 2016, rules for REITs were relaxed and the investment cap in under construction projects was raised from 10% to 20%. SPVs are now allowed to have holdings in other SPV structures and the limit on number of sponsors has also been removed. As India's stock of Grade A commercial assets grows, it presents great opportunities for REITs - and for their potential retail investors, says chairman and country head, JLL India, Anuj Puri, adding that the instrument has the potential to attract institutional and retail investors alike, because of its inherent nature to provide regular dividends at relatively low-risk levels.