Owning a slice of a gleaming office park in Bengaluru or a busy mall in Mumbai used to need crores. Today you can own a piece of exactly those properties for a few thousand rupees — through a REIT. Here's how, in simple words. This is for learning only, not a recommendation of any REIT.
What a REIT is
REIT stands for Real Estate Investment Trust. Think of it as a mutual fund for real estate. The REIT owns a bundle of income-earning properties — office parks, malls, warehouses — collects the rent, and passes most of that rent to you as regular payouts. REIT units are listed on the stock exchange, so you buy and sell them just like a share.
By law, an Indian REIT must pay out at least 90% of its net cash flows to unit-holders. That rule is what makes REITs a popular source of steady, passive income.
India's listed REITs
As of 2026, India has five listed REITs: Embassy Office Parks, Mindspace Business Parks, Brookfield India, Nexus Select Trust (malls), and Knowledge Realty Trust. Their distribution yields (the annual payout as a % of price) look roughly like this:
| REIT | What it owns | Yield (approx.) |
|---|---|---|
| Embassy Office Parks | Office parks | ~5.5% |
| Mindspace | Office parks | ~5.8% |
| Nexus Select | Shopping malls | ~6% |
| Brookfield India | Office assets | ~7.5% |
So you earn a rent-like income of roughly 5.5–7.5% a year, paid every quarter — plus the chance that the unit price rises over time as the properties grow more valuable.
Why beginners like REITs
- Small entry. SEBI cut the minimum to just 1 unit, so you can start with as little as a few hundred to a few thousand rupees — no crore needed.
- Regular income. That 90%-payout rule means steady cash, useful for people who want income.
- Easy and liquid. Buy and sell on the exchange like any share — no paperwork, no tenants, no repairs.
- Diversified. One REIT owns many buildings and many tenants, so one empty floor doesn't sink it.
What to keep in mind
- REITs are not fixed deposits. The payout and the unit price both move with the property market and interest rates.
- When interest rates rise, REIT prices often fall (their yield has to compete with safer bonds).
- You pay tax on the income and on any gains — the treatment varies by payout type, so check the details.
The takeaway
A REIT lets an ordinary investor own a professionally-managed basket of prime commercial property, earn a steady ~5.5–7.5% income, and sell any day on the exchange — all starting from a tiny amount. It's a simple way to add real estate to a portfolio without buying a flat. Think of it as one more balancing asset alongside stocks and gold, not a replacement for them.
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