Indian REITs Deliver 6-7% Yields, Surpassing Global Benchmarks

Since the first listing in 2019, the Indian REIT market has expanded steadily, reaching a market capitalization of around USD 18 Bn as of August 2025. With three more REITs expected over the next four years, India is projected to cross USD 25 billion in market capitalization.

The report ‘Indian REITS: A Gateway to Institutional Real Estate’ by official knowledge partner ANAROCK Capital and CREDAI, unveiled today at the CREDAI NATCON in Singapore, examines the Indian REIT landscape in fine detail.

Shobhit Agarwal, CEO – ANAROCK Capital, says, “Indian REITs are late to the party, but now lead the dance. Despite its late entry compared to global peers, India has strong fundamentals. The distribution yields, currently averaging at 6-7 percent, are well above many mature markets such as the US and Singapore among others. Average distribution yields of Indian REITs are competitive with fixed-income instruments but have the added potential for capital appreciation. We take a deep dive into this phenomenon in the report.”

Also Read: Mindspace REIT Raises Rs. 550 Cr via IFC Sustainability Bonds

Shekhar Patel, President, CREDAI, says, “Over 60 percent of India’s REIT market value today rests with very small set of players, with a strong base in Grade A offices linked to IT and BFSI. The future, however, holds far wider promise. As India’s cities grow, infrastructure strengthens, and the economy diversifies, REITs will expand into retail, logistics, housing, and new-age assets. This transformation will unlock unprecedented opportunities for investors and firmly place India among the most dynamic REIT markets in the world.”

Share of REITs in the Real Estate Market

Despite REIT guidelines being introduced in 2014 and the first listing only in 2019, Indian REIT market accounts for just 20 percent of institutional real estate, far below the USA (96 percent) or even Asian peers like Singapore (55 percent) and Japan (51 percent). This limited penetration is largely because Indian REITs are so far concentrated in Grade A commercial office assets, which offer scale, transparency, and stable cash flows. As the market matures, diversification is expected through data centers and logistics REITs, supported by rising digital demand and e-commerce growth, while retail mall REITs may follow with ongoing consolidation.

Residential REITs remain a longer-term prospect, constrained by low rental yields and fragmented ownership, indicating that Indian REIT sector is still in the early stages of evolution. With more asset classes becoming REITable, India’s penetration could potentially rise to 25–30 percent of institutional real estate by 2030, positioning it as one of the fastest-growing REIT markets globally.