India’s real estate investment trust (Reit) market is gaining momentum and emerging as a competitive investment alternative compared with its Asian peers, supported by strong operational fundamentals, regulatory backing, and growing investor participation, according to a report by property consultancy Anarock.
The report, titled India Reits: Taking a Stride – Building Momentum with Scale & Performance, was released on the sidelines of Excelerate 2026, a finclave organised by Naredco Maharashtra NextGen.
It said Indian Reits have delivered nearly 9 per cent five-year price returns, outperforming several regional counterparts, while distribution yields have remained competitive at 5–6 per cent.
Operational performance has remained strong, with portfolio occupancy levels across Indian Reits staying above 90 per cent and tenant bases comprising global corporates across sectors such as technology, banking and financial services, consulting, and telecommunications.
The report noted that Reits accounted for over 20 per cent of pan-India office leasing activity in the second quarter of fiscal year 2026 (FY26), with healthy re-leasing spreads and mark-to-market rental upside indicating sustained income growth potential. Since listing, Indian Reits have delivered capital gains ranging from about 12 per cent to over 60 per cent, along with consistent distribution yields.
The introduction of small and medium Reits (SM Reits) in 2025 is expected to further deepen the market by enabling retail participation through fractional ownership models and unlocking a monetisation opportunity of ₹67,000–71,000 crore, the report said.
Tax efficiency remains a key attraction for investors. Reit regulations mandate distribution of at least 90 per cent of net distributable cash flows, while more than 65 per cent of distributions are tax-exempt in the hands of investors, improving post-tax returns.
Currently, only about 32 per cent of India’s Reit-worthy assets are listed, leaving significant room for expansion, the report added. It also highlighted diversification into emerging asset classes such as logistics parks, data centres, healthcare infrastructure, and residential real estate as the next growth drivers for the segment.
India currently has five listed Reits spanning premium commercial office and retail assets, collectively managing more than 176 million square feet of leasable area. Since the first listing in 2019, the sector has expanded steadily on the back of institutional participation and regulatory reforms.
Reits were introduced by the Securities and Exchange Board of India (Sebi) in 2014 to formalise and broaden access to real estate investments by offering liquidity, diversification, and stable income streams to investors.
Speaking at the conclave, Vikas Jain, president, Naredco Maharashtra NextGen, said investor confidence in India’s real estate sector was at an all-time high and platforms such as Excelerate 2026 would help accelerate capital partnerships and sectoral growth.
Niranjan Hiranandani, chairman emeritus, Naredco Maharashtra, said the sector was at an inflection point, with urbanisation expected to increase from 35 per cent to nearly 50 per cent by 2047, reshaping demand patterns and accelerating the shift towards institutional capital through instruments such as Reits.
