REITs allow investors to gain exposure to the real estate market through fractional ownership of commercial properties like offices, housing, and land. REITs are similar to mutual funds for real estate. Investors can purchase shares of REITs for as little as Rs. 10,000-50,000, gaining exposure to a portfolio of different properties. The REIT manager then uses the funds to acquire and manage real estate assets. While the Indian REITs market is still new and growing, established REITs provide income through dividends and potential share price appreciation. However, high debt levels and market immaturity also pose risks.

1. Real Estate Investment Trust (REIT)
PRESENTED BY – SIDDHI JAIN

2. WHAT DOES IT MEAN? WHAT DOES IT DO?
Easy way to
understand
about REITS
is to compare
it with the
example of
mutual fund.
mutual fund
is for equities
what real
estate
investment
trust or
REITS are to
real estate.

3. INVESTORS INVEST
Rs10,000, Rs50,000 into
different categories of
mutual funds.
So we'll buy certain plans
from LIC Mutual Fund or
HDFC mutual Fund
ETC.
mutual
fund
managers
They will go and buy a
bunch of different
stocks depending on
the type of mutual fund
in which you have
invested.
A SPECIAL
BRIEFCASE
NOW LISTEN
CLOSELY!

4. SAME GOES FOR REIT!

5. Why do we need REITs in the first place?
• Can't we just directly go and
buy commercial properties or
plots or agricultural land,
bunch of different types of real
estate?
YESYOU CAN
BUT!
•It might
cost you a
lot of
money.
TRADITIONAL
WAY
(TICKET SIZE)
• TRUE
Fractional
ownership.
REIT

6. THIS IS ALL
REIT!
MY FUNDS
HOUSE
OFFICE
PLOT
BUILDING

7. REITS MARKET STATUS IN INDIA
 So the REITS market in India is very new and recent.
 It has just started eight years ago.
 So if you compare it to other REITS market across the world so you can see that in
the US.
 The introduction of REITs happened in 1960.
 They have a fairly big and mature real estate investment trust market.
 They're almost 96% of real estate is owned through REITS in US.
 Opposite is the situation that only 17% of the real estate in India is owned through
REITS.
 Rest 83% of the market is somewhat unorganized

8. SOME REALLY IMPORTANT POINTS !
• This is a new instrument There are a lot of uncertainties associated with it.
• As per CB regulation, 80% of the money needs to be invested via the REITS company into developed
projects. Rest 20% of the money can go to risky assets or risky real estate assets.
debt to equity is 50% or
more than 50%
slightly risky investment
from this particular
perspective
if tomorrow economy stalls
for another ten years then
these companies might not
be able to service their
debt.
high debt nature
DEBT
ORIENTED

9. So, How are we
making Profit?
SHARE
PRICE
PROFIT!
DIVIDEND
YIELD
Embassy office
Park REIT
MINDSPACE
BUSINESS
BROOKFIELD
INDIA
lead
investing
options in
India.

10. ADVANTAGES
INFLATION!
STILL BETTER
RETURN!
PARTICIPATION IN
COMMERCIAL REAL
ESTATE ECONOMY
LOW
COST

11. DISADVANTAGES
HIGH
COMMISION
HIGH DEBT
GAME
IMMATURE
MARKET

12. WHAT ARE MY VIEWS?
STILL, I want to invest in the real estate market.
What should I be doing?

13. Let the market mature a little bit and then you can make a call.
Whether investing in REITs or not?
investing in REITS would make more sense.
In case you are interested in buying
residential properties.
For now!
If you can buy a commercial real estate in tier two,
tier three cities, that could be a much Prudent financial decision..
MY OPINION