India's Office REITs Soar, Outpacing BSE Realty Index with 15% Returns
India's office Real Estate Investment Trusts (REITs) have made a significant comeback, outperforming the BSE Realty Index with a 15% capital appreciation over the past 12 months, driven by robust demand from global capability centres (GCCs) and other sectors.
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The REITs market posted steady growth, driven by strong leasing demand for institutional-grade office space. In FY 2024-25, the country's three office REITs leased over 16 million sq. ft., nearly 20% of the gross leasing volume across the top eight cities, the report states. Indian REITs attracted a significant share of demand from GCCs.
The Cushman report, which covers the five largest REIT markets in Asia: Japan, Singapore, mainland China, Hong Kong, and India, notes that India and China's REIT markets saw strong growth in 2024 and are expected to attract continued investor interest.
“India’s REIT market continues to grow, led by demand from multinational companies and a preference for premium assets. All three office REITs reached close to 90% occupancy at the end of Q1 2025,” said Somy Thomas, Executive Managing Director, Cushman & Wakefield.
As of June 2025, the Indian REIT market had three office and one retail REIT, managing over 105 million sq. ft. of operational space. Their portfolio grew over 12% in the past year, pushing the institutional share to 13% of India’s total Grade A office stock. An additional 23 million sq. ft. is under construction or planned.
GCCs accounted for 28-29% of pan-India gross leasing over the last four quarters up to Q1 2025. For office REITs, this share was even higher, at 40-60%, underscoring their growing importance to institutional landlords.
A fourth office REIT is expected to debut by the end of 2025. Knowledge Realty Trust, backed by Blackstone and Sattva Developers, will bring 48 million sq. ft. of Grade A office space (37 million operational and 11 million under development), making it one of the largest in India.
Meanwhile, mainland China's REIT market grew 85% in market value by the end of 2024, surpassing Hong Kong to become one of Asia's top three. Mature markets like Japan, Singapore, and Hong Kong remained stable.
Frequently Asked Questions
What is a Real Estate Investment Trust (REIT)?
A Real Estate Investment Trust (REIT) is a company that owns, operates, or finances income-generating real estate. REITs allow individuals to invest in large-scale, income-producing real estate without having to purchase physical property.
Why have India's office REITs outperformed the BSE Realty Index?
India's office REITs have outperformed the BSE Realty Index due to strong leasing demand from global capability centres (GCCs), BFSI, engineering firms, and a growing preference for premium-grade office assets.
What is the current occupancy rate of India's office REITs?
As of Q1 2025, all three office REITs in India reached close to 90% occupancy.
What is the expected impact of the new Knowledge Realty Trust?
The new Knowledge Realty Trust, backed by Blackstone and Sattva Developers, is expected to bring 48 million sq. ft. of Grade A office space to the market, making it one of the largest REITs in India.
How has the REIT market in mainland China performed?
Mainland China's REIT market grew 85% in market value by the end of 2024, surpassing Hong Kong to become one of Asia's top three REIT markets.
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