India’s Real Estate Investment Trust (REIT) market is delivering attractive risk-adjusted yields of 6–7%, surpassing several mature global markets and positioning it as a high-growth sector for investors. According to a new report, ‘Indian REITS: A Gateway to Institutional Real Estate,’ by ANAROCK Capital and CREDAI, the market is projected to expand its capitalization from approximately USD 18 billion in August 2025 to over USD 25 billion by 2030. The report was unveiled today at the CREDAI NATCON event in Singapore.
Despite a relatively late start with its first listing in 2019, the Indian REIT market has demonstrated strong fundamentals. “Indian REITs are late to the party, but now lead the dance,” said Shobhit Agarwal, CEO of ANAROCK Capital. He noted that the average distribution yields are competitive with fixed-income instruments but offer the additional benefit of potential capital appreciation.
Currently, Indian REITs account for just 20% of institutional real estate, significantly lower than the penetration in the US (96%), Singapore (55%), and Japan (51%). This is largely due to the sector’s concentration in Grade A commercial office assets. The report highlights significant untapped potential, noting that out of a total 520 million sq. ft. of REIT-worthy office stock in India’s top seven cities, only 32% (166 million sq. ft.) is currently listed.
The future growth of the sector is expected to be driven by diversification into new asset classes. “Over 60% of India’s REIT market value today rests with very small set of players,” stated Mr. Shekhar Patel, President of CREDAI, adding that REITs will eventually expand into retail, logistics, housing, and other new-age assets. The report predicts that as the market matures, India’s REIT penetration could reach 25–30% of institutional real estate by 2030.
A key growth area is industrial and data centre REITs, mirroring a global trend. Globally, data centre REITs were valued at around USD 250 billion in 2024 and are projected to double within seven years. India is showing strong indicators in this direction, with a 60% year-over-year surge in industrial and logistics leasing in the first half of 2025 and a threefold increase in institutional investment in the sector to USD 2.5 billion in 2024.
The proactive regulatory environment, shaped by SEBI since 2014, has been crucial in building investor confidence. Progressive reforms, including reduced lot sizes and dividend tax exemptions introduced in 2025, have enhanced transparency and retail participation. However, the report notes that dividend taxation rates in markets like the USA and Singapore are lower, making them more attractive for retail investors compared to India.
Overall, the Indian REIT market is on a strong growth trajectory, supported by deep office market demand and a stable regulatory framework, making it a compelling investment avenue for both domestic and global investors.
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