Future Of Reits In India And Its Impact On The Commercial Real Estate Sector

Being a budding reality after government’s decision of exempting dividend distribution tax, the future of REITs in India and its impact on commercial real estate sector is conceptualized to be on the brighter side. Certainly stating, REITs (Real Estate Investment Trust) is entitled to assist developers in fabricating their viable assets by giving liquidity to commercial segment for magnetizing foreign and domestic investors for sure. As a part of REIT, getting specific amount of discount by investing in under-construction properties will surely be a wonderful option for the investors.

Indeed, the future of REIT sounds to be exceptional with private equity firms earning returns of about 20 to 25 percent on their commercial investments. Also, it has been seen that subsidization of stamp duty and registration charges will enable a drastic change in the inflow of revenue proportions. With this, even the return on investment is expected to witness a drastic change for the betterment. The changes in the working scenario of authorized bodies has made it clear that investment in commercial real estate will be a great option and investors are going to enjoy better returns than before.

In fact, the scenario is such that commercial sector is set to witness a tremendous boost in terms of increase in capitalization. The best part of the occurrence of REIT is that it tends to enhance the value of commercial assets. And the people owning them are set to get quantitative rates. Since the buying property rates are on a surge with REIT; the sellers seeking to sell off their property is surely to get excellent rates. This is the reason that REIT will open gates for better value of commercial properties. It has enabled investors to buy commercial properties and yield long-term benefits. 

REIT is set to alter the scenario of real estate investments by providing simplified access to higher-valued properties to retail investors. This is a favorable decision for the investors as such properties were formerly reserved for large institutional investors. On the other hand, it is set to give liquidity and superior geographic variation to institutional investors. Now that the REIT and its special units would be publicly traded, investors might consider alternative ways for eyeing over investment properties at contractual costs that have been ominously lesser than direct investments. This depicts that the existence of REIT will reap profitable benefits for commercial sector investors

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