India’s Real Estate Investment Trust (REIT) market is experiencing rapid expansion, with its capitalisation projected to surpass $25 billion by 2030, according to a new ANAROCK–CREDAI report. Supported by regulatory reforms, investor appetite, and sectoral diversification, REITs are emerging as mainstream vehicles for institutional investment, offering highly competitive yields and substantial growth prospects
Indian REIT Sector: Rapid Growth and Potential
Since its inception in 2019, India’s REIT segment has gained significant momentum, achieving a market capitalisation of approximately $18 billion by August 2025. Expansion is expected to accelerate with the anticipated listing of three new REITs over the next four years, further boosting investor confidence and market depth.
Competitive Yields and Global Comparison
Distribution yields for Indian REITs currently average 6–7%, outpacing returns in mature markets such as the US and Singapore. These yields provide robust income streams that compete favourably with fixed-income products, while maintaining the potential for capital appreciation.
Diversification: Office, Logistics, Retail & Data Centres
Historically, Indian REITs have been concentrated in Grade A commercial office assets, particularly those linked to IT and BFSI companies. However, the market is primed for expansion: diversification toward logistics, warehousing, retail malls, and data centres is gathering pace, driven by rapid urbanisation and strong institutional demand.
Regulatory Reform and Investor Confidence
Regulatory changes—including the introduction of REIT guidelines in 2014, reduction of lot sizes, simplified capital gains tax, and fresh dividend tax exemptions—have enhanced market transparency and retail participation, fostering broader accessibility.
Market Outlook and Leadership Perspective
Currently, over 60% of India’s REIT market value is held by a small group of firms, but sector leaders anticipate far wider participation in the coming years. Penetration, still at 20% of institutional real estate, is expected to rise to 25–30% by 2030, positioning India as one of the world’s fastest-growing REIT destinations.
FlexInsights Take
India’s REIT market is entering a pivotal growth phase, catalysed by investor demand, regulatory confidence, and asset-class diversification. The sector’s competitive yields, combined with potential for market expansion, are reshaping the investment landscape and promising stable returns as well as long-term capital appreciation. For institutional investors and forward-looking teams, India’s REIT story is one to watch—offering unmatched opportunity in a rapidly transforming real estate environment.
