Indian REITs attract family offices as sector hits $100bn AUM
India's real estate and infrastructure trusts are capturing significant capital from wealthy investors and institutions seeking high-yielding, inflation-hedged alternatives to traditional fixed income.
Indian Real Estate Investment Trusts and Infrastructure Investment Trusts are experiencing a surge in capital allocations from family offices and institutional investors. The shift comes as the listed universe expands and these hybrid instruments deliver outsized returns compared to traditional fixed-income products.
The momentum is reflected in the Nifty REITs & InvITs Index, which has gained 11% in 2024, 20% in 2025, and over 47% so far in 2026. Retail and institutional participation has deepened accordingly. Embassy Office Parks REIT, the country's first listed trust, has seen its unitholder base grow 34-fold over seven years to more than 135,000. Meanwhile, mutual funds now hold a quarter of the units in Brookfield India Real Estate Trust.
The migration toward these trusts is primarily driven by post-tax return headwinds on traditional debt. “Family offices are moving towards Reits and InvITs, and this shift is being driven by the comfort that they are backed by real assets, regulatory supervision, with more than 80% of assets being revenue-generating, thus reducing construction risk, and the mandatory distribution of cash flows,” said Shravan Sreenivasula, executive director and head of investment solutions at Avendus Wealth Management.
Market professionals emphasize that these instruments are not replacing debt but serving as strategic portfolio complements. Ashwin Patni, head of wealth management solutions at Julius Baer India, noted that REITs and InvITs sit between debt and equity. They offer high regular distributions, low beta, and low correlation with equities, while also providing a distinct inflation hedge.
The investable landscape has broadened well beyond initial offerings in commercial offices and toll roads. Investors can now access underlying assets spanning renewable energy, shopping malls, telecom towers, warehousing, and industrial parks. “Equally important, we have seen several high-quality sponsors such as leading real estate developers, infrastructure operators and global investment managers bringing their offerings to market, which has added to the confidence of investors,” Patni said.
This thematic diversification has helped the sector accumulate a massive footprint. “The market represents over $100 billion in assets under management across commercial offices and retail property, roads, power transmission, renewable energy, telecom, infrastructure, and other sectors,” said Shishir Baijal, international partner, chairman and managing director of Knight Frank India. He noted that REITs have generated total annual returns of 13% to 15% since inception.
Despite the structural appeal, secondary-market liquidity remains a constraint for the asset class. Patni cautioned that while trading volumes have improved over time, thin liquidity persists, though it is unlikely to deter long-term capital allocators from entering the market at current yields.
