India’s REIT Market: Institutional Scale, Retail Opportunity: A Big-Picture Look at India’s Five Listed REITs 17Feb2026
(The views expressed here are for information purposes only and should not be construed as a
recommendation or investment advice. While the author is a CFA Charterholder
with nearly 25 years of experience in financial markets, this content
is intended to share general insights and does not constitute financial
guidance. Please consult your financial
adviser before taking any investment decision. Safe to assume the author
has a vested
interest in stocks / investments discussed if any.)
While the concept of investing in commercial real estate through the stock market may sound promising, India’s listed REIT sector is still in its early stages. As of now, there are only five REITs publicly traded.
Although this represents a significant step toward owning a piece of large-scale commercial property to public investors, it remains a small slice compared to the overall Indian stock market and the vast physical real estate owned by households.
Let’s take a closer look at what these five REITs represent and how they fit into the broader investment landscape.
A REIT, or Real Estate Investment Trust, is a company that owns and manages income-generating real estate and lets investors buy REIT units on stock exchanges to earn a share of the rental income and potential capital appreciation.
India’s listed REIT market is still in its early stages, with just five players shaping the space. While small in number, these REITs represent large, professionally managed commercial properties leased primarily to corporate tenants.
For retail investors, this means REITs offer a way to participate in commercial real estate without buying or managing property directly, but on a relatively small scale compared to India’s overall stock market and the vast household investment already tied up in residential real estate.
The market is growing, structured and stable, but listed REITs currently function best as a satellite allocation rather than a core holding.
The above chart presents the overall scale of India’s listed REIT universe, including market capitalisation, gross asset value (GAV), total leasable area (in msf or million square feet) and unitholder count.
2. Making Sense of REIT Numbers for Investors
Chart showing Five Listed REITs in India: Valuation Matrix >
Please click on the chart to view better >
Data sources: Various investor presentations and quarterly result updates by the REITs.
Unlike traditional stocks, REITs are evaluated using metrics that reflect the underlying real estate rather than just price or earnings.
Key metrics include market capitalisation, gross asset value (GAV), total leasable area, occupancy rates, lease tenure (WALE or weighted average lease expiry), distribution yield, net asset value (NAV) and funds from operations (FFO).
These help investors understand the size, income potential, stability and asset backing of each REIT.
In the Indian context, additional factors are also important. Sponsor quality and ownership stake indicate governance and long-term credibility. Concentration of tenants shows potential risk exposure, while geographic spread reveals where rental income is coming from.
Debt or leverage levels help assess financial stability. Occupancy by segment, whether office or retail, provides insight into which businesses are driving revenue.
The above chart presents India’s five listed REITs across some of these metrics. Retail investors can use it to understand how the REITs compare in size and structure, without needing to evaluate individual properties or financial statements.
It’s important to remember that each REIT is unique, with different portfolios, lease structures, tenant mixes and market exposures.
There is no single metric or valuation approach that fits all REITs, and this matrix should be used as a guide for relative positioning rather than a definitive investment recommendation.
Individual REIT evaluation is outside the scope of this article.
In short, the valuation matrix gives readers a clear view of India’s listed REIT market as a small but growing segment offering professionally managed, income-generating commercial real estate.
Ten key REIT metrics investors should keep in mind:
Market Capitalisation – The total value of all REIT units traded on the stock exchange, giving a sense of the REIT’s size and liquidity.
Gross Asset Value (GAV) – The combined value of all properties owned by the REIT, showing the scale of its underlying real estate.
Leasable Area – The total area of the REIT’s properties that can be rented out, usually measured in million square feet.
Occupancy Rate – The percentage of leasable space that is currently rented, indicating how much of the REIT’s assets are generating income.
Occupancy by Segment – Occupancy broken down by property type, such as office or retail, showing which segments are driving revenue.
Lease Tenure / WALE (Weighted Average Lease Expiry) – The average remaining duration of leases, weighted by rental income, indicating stability and visibility of future cash flows.
Distribution Yield – The income paid to investors as a percentage of the REIT’s market price, similar to a dividend yield.
Net Asset Value (NAV) – The value of a REIT’s assets minus liabilities, representing the book value per unit.
Funds from Operations (FFO) – Cash generated from the REIT’s core property operations, often used to fund distributions.
Sponsor Quality / Ownership Stake – The reputation and holding of the REIT’s sponsor, which reflects governance quality and alignment of interests.Key observations from the above Valuation Matrix:
The five listed REIT players are:
Embassy Office Parks REIT,
Mindspace Business Parks REIT,
Brookfield India Real Estate Trust,
Nexus Select Trust and
Knowledge Realty Trust.
Four of these are office-focused REITs, reflecting the depth and institutionalisation of India’s Grade A office market across cities like Bengaluru, Mumbai, Hyderabad and Pune.
The fifth, Nexus Select Trust, is the only retail-focused REIT in the listed space, giving investors exposure to shopping malls.
Embassy Office Parks REIT was the first to list in Apr2019. And the youngest one is Knowledge Realty Trust.
Knowledge Realty Trust is the largest by market cap at about 55,750 crore.
All REITs are trading above their IPO price. Since listing, Mindspace (16.1 per cent CAGR) and Nexus (22.3 per cent CAGR) have delivered the strongest compounded returns among the seasoned vehicles.
Knowledge Realty Trust is too recent for a meaningful CAGR comparison.
On a current market price (CMP) to net asset value (NAV) basis, most REITs are trading close to their net asset value, roughly in the 1.0 to 1.07 range, suggesting the market is valuing them near underlying asset value.
Two years ago, Indian REITs traded below NAV due to higher interest rates, post-WFH uncertainty and valuation assumptions.
With rates stabilising, cash flows proving resilient and investor confidence improving, discounts narrowed.
Today, limited supply and strong income demand have pushed most REITs to trade at a premium to NAV.
The expansion of Global Capability Centres (GCCs) by multinational firms in India has driven steady leasing of Grade A office space, especially in cities like Bangalore, Hyderabad, and Pune -- which in turn has stimulated investor interest in REITs.
Price-earnings ratios vary widely, from around 30 times (Knowledge Realty Trust) to over 100 times (Embassy), reflecting differences in accounting earnings and capital structures rather than just operating strength.
Embassy and Knowledge Realty Trust have the largest gross asset values, both around 64,000 crore.
In terms of leasable area, Embassy leads with 51.6 million square feet.
Office REITs show strong occupancy levels between 90 and 93 per cent, while Nexus Select Trust has the highest occupancy at 97 percent in retail malls.
WALE, or weighted average lease expiry, is highest for Embassy at 8.4 years, indicating longer lease visibility. And Nexus at 4.7 years, reflecting the typically shorter lease tenures in retail.
Corporate tenants, particularly global capability centres (GCCs), are driving demand for office REITs, supporting predictable rental income.
Overall picture:
The office REITs are broadly similar in structure: large commercial portfolios, high occupancy, long lease tenures and trading close to NAV.
The retail REIT, Nexus Select Trust, stands out for higher occupancy and stronger recent return performance, but with shorter lease tenures and smaller asset size.
3. Shortcomings of the Indian REIT Space
The listed REIT market in India is still very small, with only five REITs and a combined market cap of around Rs 1.90 lakh crore, making it a tiny fraction of the overall equity market.
Retail investors already hold a large portion of their wealth in physical real estate, mostly residential, while REITs focus on institutional-grade office and retail assets leased to corporate tenants.
This means listed REITs offer limited exposure for individual investors and are largely tied to business demand rather than housing cycles.
Despite high asset quality, their scale is too small to meaningfully influence retail portfolios. The market remains in an early stage, and while growth potential exists, REITs currently function best as a small portfolio allocation.
4. How to Think About REITs in a Portfolio
Listed REITs in India are best considered as a satellite allocation rather than a core holding. They offer exposure to professionally managed commercial real estate with rental income and potential capital appreciation.
REITs have a hybrid nature, combining steady rental distributions with equity-like market price movements. As per SEBI’s new classification, effective 01Jan2026, REITs are being treated as equity instruments for mutual fund purposes, though prior to 2026 they were classified as hybrid.
Investors can use metrics like occupancy, lease tenure, distribution yield and scale to gauge stability and income potential, but each REIT is unique.
Investing in REITs carries risks such as market price volatility, changes in interest rates and tenant or lease-related uncertainties. Concentration in a few corporate tenants or cities can also affect income stability.
Retail investors should weigh these factors before allocating capital.
Overall, REITs provide income and growth potential, but their small market size and corporate focus mean they complement rather than replace traditional equity or fixed-income investments.
5. Gist
India’s listed REIT market remains small but structurally looks strong, offering access to high-quality commercial real estate. Each REIT has unique features and performance depends on property type, lease structure and micro-market dynamics.
For retail investors, REITs are best considered a complementary or non-core allocation, providing income and diversification without replacing traditional equities.
As the market matures, REITs could gradually bridge household real estate exposure with sophisticated capital markets.
Investors should do their own due diligence before committing any investments. This is just for educational purposes and should not be construed as investment advice.
(Even though the blog was published on 17Feb2026, a bonus section contrasting REITs, flex space and developers was added on 18Feb2026 below -- thank you for your patience).
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P.S.: Bonus Section (added on 18Feb2026):
Business Model Snapshot: REITs vs Flexible Workspace Solutions vs Real Estate Developers:
Big Structural Difference >
REITs = yield + stability
Flex operators = growth + operating risk
Developers = Realty cycle + leverage + land bank play
REITs own completed income-producing assets and generate stable, bond-like cash flows driven by long-term leases and cap rates.
Flexible workspace firms operate leased offices, earning higher-growth but more volatile, occupancy- and margin-sensitive revenues.
Developers acquire land and build to sell, making them the most cyclical, leverage-sensitive and dependent on real estate demand cycles.
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References and additional data:
Image courtesy: Embassy REIT (Embassy Quadron building in Pune)
Indian REITs Association, CAMS and CareEdge
Tweet thread on REITs
RBI proposes allowing banks to lend against REITs 09Feb2026
Nifty REITs & InvITs Index
Screener.in valuation matrix of REITs as at end-17Feb2026 >
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Disclosure: I've got a vested interest
in Indian stocks and other investments. It's safe to assume I've interest in the financial instruments / products discussed, if
any.
Disclaimer: The analysis and
opinion provided here are only for information purposes and should not be construed
as investment advice. Investors should consult their own financial advisers
before making any investments. The author is a CFA Charterholder with a vested
interest in financial markets.
