SEBI Considers Opening REITs to Small Investors
India’s markets regulator is considering opening up real estate investment trusts (REITs) to small investors by gradually lowering the minimum trading lot size of REIT units from ?50,000 to the value of just a single unit, much like how stocks are traded. The move is aimed at improving liquidity
Published -
Jul 11, 2020 6:51 AM
India’s markets regulator is considering opening up real estate investment trusts (REITs) to small investors by gradually lowering the minimum trading lot size of REIT units from ?50,000 to the value of just a single unit, much like how stocks are traded. The move is aimed at improving liquidity for investors in REITs. Sebi is considering a plan to gradually make REITs trading akin to share trading. This will help grow the market as it will channelize household investments into commercial realty. Sebi’s proposal is in line with global practices where even a single REIT unit can be traded. Though Sebi allowed listing of REITs in 2016, so far, Embassy REIT is the only listed entity. Despite subdued equity markets, Embassy REIT fetched a return of 25% over the last one year, which explains the growing popularity of REITs and the reason why Sebi is now planning to allow retail investors to enter REITs market. To be sure, Sebi wants to go slow on easing REIT norms. Sebi wants more REITs to list before opening it up to retail investors. It is still an instrument meant for more savvy investors. One REIT experience may not be enough for a proper assessment of governance and reporting. In the past few weeks, several potential REIT issuers have met Sebi to discuss ways to open up the REIT market.
Tags : News/Views Latest News Real Estate SEBI liquidity REITs Embassy