Fractional ownership platform hBits to list first SM REIT by Q3, applies for licence

Similar to REITs, SM REITs are fully regulated by SEBI with units of each of the schemes listed on the stock exchanges.

Fractional ownership platform hBits has applied for Small and Medium Real Estate Investment Trust licence with the Securities and Exchange Board of India (SEBI) and aims to list its first SM REIT by Q3FY25, the company said on August 27.

"We believe in the tremendous potential that commercial real estate has to offer to Indians and through SM REITs we aim to provide our investors with diversified, lucrative and regulated investment opportunities," hBits founder and chief executive officer Shiv Parekh said.

The market regulator in March notified the SM REIT regulations, bringing fractional ownership platforms within the regulatory framework as a subclass within the REIT regulations for assets valued between Rs 50 crore and Rs 500 crore. Similar to REITs, SM REITs are fully regulated by SEBI with units of each of the schemes listed on the stock exchanges.

Also Read: Small and medium REITs: Sebi launches new framework for fractional ownership of real-estate

The company said it expects to receive the licence in the next couple of months and launch its SM REIT offering in the third quarter of the current financial year.

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Once the SM REIT is launched, the platform will subsequently migrate its existing properties into SM REITs over the next few quarters, the company noted.

hBits recently launched multiple opportunities in Pune. It aims to increase its total assets under management (AUM) to Rs 10,000 crore over the next five years, the firm said. hBits manages a portfolio of 14 properties across key cities, with an AUM of over Rs 365 crore.

The company is focussed on acquiring properties in premium locations across the country, targeting sectors such as premium office spaces, warehouses, and data centres among others, the firm said.

The introduction of SM REITs regulations by SEBI is expected to create a more structured and secure environment for fractional real state ownership investments.

By migrating existing assets and acquiring new ones, hBits is poised to capitalise on this regulatory framework, enhancing the overall investment proposition for its stakeholders, the company said.

Also Read: Property Share receives India’s first SM REIT licence; to launch IPO of the first SM REIT soon

Earlier this month, another fractional ownership platform, Property Share, said it received the country’s first SM REIT licence from the SEBI under the name of Property Share Investment Trust.