Episode Details

In this episode of Paisa Vaisa, host Anupam Gupta sits down with Preeti Chheda CFO of Mindspace Business Park, Executive Committee Member of the Indian REITS Association, and a finance professional with 25 years of experience for the most comprehensive conversation on Real Estate Investment Trusts (REITs) in India.

Preeti brings an extraordinary academic and professional pedigree CA, CS, CFA, CPA and has spent the last 19 years with the K. Raheja Corp group heading finance for Mindspace, one of India's largest commercial real estate platforms. She is uniquely positioned to explain exactly how REITs work, why SEBI built one of the world's most robust regulatory frameworks around them, and why ₹2.5 lakh crore in assets are now held within REITs and InvITs combined all within just eight years of the first REIT launch in India.

The episode begins with the formation of the Indian REITs Association (IRA), launched in September 2023 at SEBI's nudging, with three clear goals: creating product awareness, driving policy changes to grow the instrument, and improving governance standards.

Preeti then explains the fundamental structure of REITs pooled investment vehicles, structured as trusts (mirroring Singapore's regulation), that hold bundles of commercial real estate assets and provide investors with a combination of recurring income (yield) and capital growth. She breaks down the three income streams unit holders receive: tax-free dividends, taxable interest, and return of capital (which reduces cost of acquisition and is taxed only on exit as capital gains). REITs are mandated to distribute at least 90% of their net distributable cash flows (NDCF), and every unit holder receives a Form 64B detailing their income breakdown.

The performance discussion is eye-opening. Indicative yields range from 6-8%, but total returns combining yield and growth have historically averaged 14-16%. Mindspace REIT itself has gone from a listing price of ₹275 in August 2020 to over ₹490 in February 2026, delivering over 50% price appreciation in six years on top of continuous distributions. Growth comes from three engines: inbuilt contract escalations of around 5% annually, rent reversions of 7-8% when leases renew at market rates, and acquisitions plus development (up to 20% of portfolio value can be under development within existing parks).

A standout section of the episode compares REITs to physical real estate investment. REITs offer a starting ticket size as low as ₹500, instant liquidity via exchange trading, professional management, and diversification across cities and properties. Physical real estate, by contrast, requires massive capital, is illiquid (2-3 months minimum to sell), demands active management, and carries transaction costs of 10-11% of the purchase price in brokerage, stamp duty, registration, and maintenance. As Anupam points out, your property needs to appreciate by 10% just to break even a bar that most residential real estate in India fails to clear.

The regulatory deep-dive reveals why institutional investors starting with FPIs trusted Indian REITs from day one. SEBI mandates that 80% of REIT assets