SMREIT market likely to exceed $75 bn, driven by 500 mn sq ft of eligible commercial assets: CBRE

India’s Small and Medium Real Estate Investment Trusts (SM REITs) market is likely to cross $75 billion, backed by more than 500 million sq ft of eligible office, logistics and retail assets, according to a report released by CBRE South Asia Pvt. Ltd.

The report titled ‘From Niche to Next Wave: SM REITs Forging Real Estate Investment Frontiers’ said that REITs own, operate, or finance income-producing real estate across a range of sectors. They enable people to purchase units, typically with a relatively low minimum investment, thereby allowing small investors to access high-value commercial real estate. SM REITs control smaller properties, valued between ₹50 crore and ₹500 crore.

A REIT is a regulated investment vehicle that owns or manages income-producing real estate like offices, malls, or warehouses. It allows people to invest in large commercial properties by purchasing units, similar to shares, typically with a low minimum investment amount. Investors earn returns from rent and potential property value growth, with clear rules and transparency.

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Building on CBRE India Research’s benchmark 2024 study, the updated 2025 analysis reassesses the evolution and long-term potential of SM REITs to accelerate institutionalisation in the Indian property market, it said.

Anshuman Magazine, chairman and CEO, India, Southeast Asia, Middle East & Africa, CBRE, said SM REITs are reshaping real estate investment by offering a structured, transparent and scalable approach to fractional ownership.

“This segment is anticipated to significantly deepen the institutionalisation of India’s commercial real estate. By bringing small-to-mid-sized assets under a regulated umbrella, SM REITs can drive higher standards of property management, promote ESG compliance, and contribute to a more organised and efficient ecosystem,” he said.

The report noted that India’s premium Grade A+ office assets will continue to anchor institutional demand, serving as strong portfolio building blocks for both REITs and SM REITs.

Rami Kaushal, Managing Director, Consulting and Valuation Services, India, Middle East & Africa, CBRE, stated that SM REITs bridge a key gap between direct property ownership and large-scale REITs.

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“SM REITs could offer investors stable rental income and the prospect of capital appreciation on high-quality assets. As the market matures, the ability to navigate a developing regulatory framework will be critical for SM REITs to emerge as a long-term investment mainstay,” he said.

In 2024, the Securities and Exchange Board of India (SEBI) introduced a dedicated regulatory framework for SM REITs by amending the SEBI (Real Estate Investment Trusts) Regulations, 2014, laying the groundwork for a more transparent and standardised structure for fractional real estate ownership. CBRE’s report further highlighted the broad advantages SM REITs could bring across the real estate value chain.

For investors, CBRE said SM REITs could democratise access to premium commercial assets, offering the possibility of stable rental income alongside long-term capital appreciation. These benefits are strengthened by the liquidity of exchange-listed units and the assurance of transparent governance.

For developers, SM REITs could serve as an effective capital management tool for mid-sized assets, helping them recycle capital more efficiently into new projects while opening avenues to a wider and more diverse investor base, it said.