Real estate investment trusts (REITs) have been there for a while now, starting with US in 1960 and now exceeding 40 countries across the globe. In India, first draft guidelines to establish a REIT market was published in Dec 2007 but it did not materialize due to ambiguity in the taxes and the dwelling 2008 financial crisis. It was in 2013, when SEBI released a consultation paper that established norms to allow the public issue of REITs. In contrast to other parts of the world, Indian REITs operate more like a listed company than mutual funds. Investors purchase units based on an offer letter and the REIT is then listed on the stock exchange. To exit REITs, investors can either sell units or buy into SPVs that invests in property. Like shares, units can be traded at a discount or above the company’s intrinsic price at the stock exchange, in contrast to mutual funds which can only be exited at NAV linked prices. REIT as a liquid real estate investment product is also at times, not necessarily, seen as a substitute to a debt mutual fund investment. Expected indicative returns in REIT as an asset class stand anywhere between 8-10% pretax per annum.

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