A wait for market conditions to improve further to transfer ownership to Reits could prove indefinite. The best time to get going is now.
It is time real estate investment trusts (Reits), investment vehicles akin to a mutual fund, took off. They now have a tax regime that suits their requirements. Timely launch will boost returns for Reits, help developers saddled with debt, offload inventory and reduce bad loans on the banks’ books. Typically , Reits own commercial properties such as apartment complexes, shopping malls, hotels, office buildings. Rentals from properties owned and managed by them form a substantial slice of their revenues. Reits will also help finance the physical infrastructure of India’s rapid urbanization.
The Blackstone Group and its partner Bangalore-based Embassy Group have reportedly hived off their portfolio of as sets into a separate company , which would be the first step to unlock value through a listing. Sebi has already put in place a robust regulatory framework for Reits.
Courtesy – ET Realty