Revised Sebi norms to improve liquidity for REIT market

The relaxation in investment norms real estate investment trusts by Securities and Exchange Board of India is expected to improve liquidity for Indian Reits and investors, bring in more retail investors and encourage more public listings in the future. On Tuesday, Sebi revised the minimum subscription and trading lot for publicly issued Reits and infrastructure investment trusts, with the minimum application value to be brought down from ₹50,000 now to a range of Rs.10,000-15,000 and the revised trading lot shall be of one unit. Reduction in minimum application amount will further bring in more investors thus improving the liquidity in REITs,” said Vinod Rohira, CEO, Mindspace Business Parks REIT In July 2020, Mint first reported that Sebi was considering opening up Reits and InvITs to small investors by 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. Currently, there are three public listed office Reits in the country – Embassy REIT, Mindspace Business Parks REIT and the most recently listed Brookfield India REIT. The reduction in lot size will increase liquidity for the entire REIT market, enable REITs to be included into benchmark domestic indices and allow greater participation from newer pools of institutional and retail investors.” India’s largest developer DLF Ltd is already gearing up for an office Reit and has appointed advisors.