Indian REITs Outshine Global Counterparts with 6-7.5% Yields: Report
Indian Real Estate Investment Trusts (REITs) are generating impressive yields of 6-7.5% for unitholders, surpassing mature markets like the US and Japan, according to a recent report by Credai and Anarock. This article explores the current landscape and future potential of Indian REITs.
ReitsReal EstateInvestmentYieldsIndiaReal Estate NewsSep 13, 2025
Credai, the apex body of Indian real estate developers, and property consultant Anarock released a report titled 'Indian REITs - A Gateway to Institutional Real Estate' at a recent event. The report highlights the current state and future potential of the Indian REIT market.
Currently, there are five listed REITs in India: Brookfield India Real Estate Trust, Embassy Office Parks REIT, Mindspace Business Parks REIT, Nexus Select Trust, and Knowledge Realty Trust. Nexus Select Trust is backed by rent-yielding retail real estate (shopping malls), while the other four are office REITs.
The report states, 'Average distribution yields of Indian REITs range between 6% and 7.5%, competitive with fixed-income instruments but with the added potential for capital appreciation.' This makes Indian REITs an attractive alternative to traditional fixed-income investments.
When compared to other REIT markets globally, the report found that India still lags behind mature markets like the US, Singapore, and Japan in terms of diversification of REIT asset classes. However, the risk-adjusted yields in India remain highly attractive. Shobhit Agarwal, CEO of Anarock Capital, noted, 'Indian REITs are late to the party, but now lead the dance. Despite its late entry compared to global peers, India has strong fundamentals. The distribution yields are well above many mature markets such as the US and Singapore.'
The average yield in the US is 2.5-3.5%, in Singapore it is 5-6%, and in Japan it is 4.5-5.5%. This significant difference in yields highlights the potential for Indian REITs to attract international investors.
Shekhar Patel, President of Credai, emphasized the current and future potential of the Indian REIT market. 'Over 60% of India's REIT market value today rests with a very small set of players, with a strong base in Grade A offices linked to IT and BFSI. The future, however, holds far wider promise. As India's cities grow, infrastructure strengthens, and the economy diversifies, REITs will expand into retail, logistics, housing, and new-age assets.'
REITs are investment vehicles that own or operate income-generating real estate, enabling investors to earn a share of the income produced without directly purchasing the properties. This structure provides investors with a way to diversify their portfolios and gain exposure to the real estate market.
Credai, which has more than 13,000 members, is organizing its annual event, Credai-NATCON. Over 1,000 delegates, including real estate developers and property consultants, are attending this three-day conference that started on September 11. The event aims to discuss the latest trends and opportunities in the Indian real estate market, with a particular focus on the growing importance of REITs.
Frequently Asked Questions
What are REITs?
REITs, or Real Estate Investment Trusts, are investment vehicles that own or operate income-generating real estate. They allow investors to earn a share of the income produced without directly purchasing the properties.
What is the average yield of Indian REITs?
The average distribution yield of Indian REITs ranges between 6% and 7.5%, which is competitive with fixed-income instruments and offers the potential for capital appreciation.
How do Indian REIT yields compare to other global markets?
Indian REIT yields are higher compared to mature markets like the US (2.5-3.5%), Singapore (5-6%), and Japan (4.5-5.5%).
What is the future potential of Indian REITs?
As India's cities grow, infrastructure strengthens, and the economy diversifies, REITs are expected to expand into retail, logistics, housing, and new-age assets, unlocking unprecedented opportunities for investors.
What is the Credai-NATCON event?
Credai-NATCON is an annual event organized by Credai, the apex body of Indian real estate developers. It brings together over 1,000 delegates, including real estate developers and property consultants, to discuss the latest trends and opportunities in the Indian real estate market.
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