India's real estate investment trusts (REITs) currently represent a more 19% of the country's listed real estate, a stark contrast to the global average of 57%

By Bricksnwall | 2026-01-11

The analysis forecast a rise in the market capitalization of Indian REITs, anticipating growth from $18 billion in 2025 to $25 billion by 2030.

India's Real Estate Investment Trust (REIT) market is still finding its footing. Currently, REITs represent a mere 19% of the nation's listed real estate value. In contrast, the global average sits at 57%. This disparity underscores India's comparatively low adoption rate. However, it also suggests significant potential for expansion over time, as the market develops and becomes more varied. This assessment comes from a report published by Vestian Research on January 10th.

India's REIT market, as the report suggests, is maturing, moving beyond its early stages. Market capitalization is expected to climb, reaching $25 billion by 2030, up from $18 billion in 2025. The number of office assets eligible for REITs is also set to double, going from ₹8.2 trillion in 2025 to ₹16 trillion by 2030. Coupled with the growth of retail and alternative asset classes, India is poised to become a significant player in the global REIT landscape.

The groundwork is solid. The coming expansion hinges on diversification, achieving scale, and consistent policy – these are the crucial elements that will reshape India's REIT landscape into a comprehensive, multi-sector investment arena.

The report notes that India presently has five publicly traded REITs. Four of these concentrate on office properties, while one is focused on retail. This preponderance of office REITs underscores the nascent state of the ecosystem; many other real estate asset classes haven't yet reached the scale, maturity, or institutional framework necessary for public REIT listings, the report explains.

Global REITs: A Study in Contrasts

The report painted a picture of a world where REIT ecosystems are remarkably varied. The United States, Australia, Singapore, Japan, and the UK, for instance, boast a wide array of REIT categories. These encompass everything from residential and healthcare properties to logistics, self-storage, data centers, and mortgage-backed platforms.

In the US and Australia, REITs account for over 95% of the listed real estate value, a clear indication of the advanced nature and depth of these markets. By contrast, India's REIT market capitalization is a mere 0.4% of the total stock market, a figure that underscores its nascent stage while simultaneously pointing to the significant potential that remains, according to the report.

India's REIT landscape: nascent, yet growing.

The report notes that while REIT regulations were established in 2014, the country's inaugural REIT listing didn't occur until 2019. Since then, the sector has seen considerable expansion. It grew from ₹264 billion in FY20 to ₹1.6 trillion by the second quarter of FY26. Despite this progress, the supply of established, income-producing assets is still somewhat constrained. A significant portion of the commercial real estate is either still being built or is owned in fragmented ways.

According to the report, office properties remain the foundation of India's REIT market. The listed portfolios encompass over 135 million square feet. These assets benefit from consistent leasing demand from Global Capability Centres (GCCs), technology companies, and BFSI tenants, which in turn supports stable yields of 5–7%.

India's office market boasts more than a billion square feet of space, with almost half a billion square feet deemed suitable for Real Estate Investment Trusts (REITs). Furthermore, 34 million square feet is already earmarked for future REITs. Developers are clearly gearing up to capitalize on this opportunity. For instance, Bagmane Developers, with Blackstone's backing, is anticipated to debut a ₹4,000 crore REIT IPO in early 2026. This could potentially be the next significant listing, drawing in even more institutional investors, according to the report.

Retail REITs have taken their time to gain traction, the report suggests, largely because of the sector's reliance on foot traffic, consumer habits, and the complexities of managing tenants over the long haul. Right now, Nexus Select Trust stands alone as India's sole retail REIT, even though the nation boasts more than 89 million square feet of Grade A retail space.

Currently, only 10.6 million square feet of Grade A mall space is held by REITs, which represents a significant institutional opportunity, almost eight times greater. With increasing consumer spending and the maturation of professionally managed malls, the value of retail assets suitable for REITs is anticipated to rise from ₹1.5 trillion in 2025 to ₹2.4 trillion by 2030. Industry projections indicate that two to three new retail REIT listings will likely occur within the next three to five years, potentially pushing the retail REIT market to a value of $6–9 billion by 2030. Cities like Indore, Coimbatore, Surat, Chandigarh, and Bhubaneswar are poised to be instrumental in developing this diverse pipeline.

India's REIT market is ripe for growth, especially considering its current low adoption rate and the need to diversify beyond just office spaces and a few retail properties. "As the market matures, sectors like data centers, logistics, industrial parks, and warehousing present scalable, income-generating prospects that mirror those found in established global REIT markets," explained Shrinivas Rao, FRICS, CEO of Vestian.

Residential properties are still not ready for prime time.

The report suggests that residential real estate is close to being included in REITs, but several structural hurdles remain. Rental yields are low, hovering around 2–3%. Ownership is fragmented, and there's a high turnover of tenants. Furthermore, there aren't any large institutional rental portfolios, which continues to hinder the sector's potential.

India also lacks a comprehensive rental housing policy, a key factor in the success of REITs in more developed markets like the US, Japan, and Singapore. Although new models such as co-living, student housing, and senior living show potential, residential REITs are likely a longer-term goal, the report concluded.

Source: Hindustan Times