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What are Real Estate Investment Trusts (REITs)?

Real Estate Investment Trusts (REITs) are regulated investment vehicles enabling investors to participate in income-generating real estate assets without the need for direct ownership. Governed by the SEBI (Real Estate Investment Trusts) Regulations, 2014, REITs pool funds from investors to build a diversified portfolio of properties like commercial complexes, office spaces, shopping malls, and hospitality assets. SEBI has established regulations to ensure transparency, investor protection, and market integrity in the establishment, operation, and management of REITs in India.

Key Features of REITs under SEBI Regulations

☀ Minimum Asset Requirement: SEBI mandates that REITs must have a minimum asset value of INR 500 crore at the time of initial listing.

☀ Investment Mandate: REITs are required to invest at least 80% of their assets in completed and revenue-generating real estate properties. Additionally, they can invest up to 20% of their assets in under-construction properties or other permissible investments.

☀ Distribution of Income: REITs are mandated to distribute at least 90% of their net distributable income to investors in the form of dividends, ensuring regular income flow to investors.

☀ Listing and Trading: SEBI regulations require REITs to be listed on recognized stock exchanges, enabling liquidity for investors through trading of REIT units on the secondary market.

KCAPL's Role in REITs At KCAPL, we offer specialized services tailored to assist client in establishing and managing SEBI-compliant REITs.

Our services for REIT consulting include:

• Structuring and Setup: We assist clients in structuring their REITs and navigating the regulatory requirements set forth by SEBI.

• Documentation and Compliance: Our experts handle the drafting of legal documentation and ensure compliance with SEBI regulations throughout the REIT's lifecycle.

• Asset Portfolio Management: We provide guidance on selecting suitable real estate assets for inclusion in the REIT portfolio and optimizing asset performance to maximize returns.

• Investor Relations: We help client build strong relationships with investors, facilitating capital raising and ensuring transparency and communication throughout the investment cycle

Partner with KCAPL for comprehensive and SEBI-compliant REIT services, leveraging our expertise to unlock the potential of income-generating real estate assets.

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