Indian REITs offer higher returns than US, Singapore, to surpass $25 billion by 2029: Report

The report noted that REITs constitute a small portion of institutional real estate till now

India’s real estate investment trust (REIT) market has grown steadily since its first listing in 2019, reaching about $18 billion in value in August. With three more REITs expected over the next four years, the market could go beyond $25 billion, a report by ANAROCK and CREDAI has said.

Indian REITs delivered 6–7 percent yields, surpassing global benchmarks. Data Centre REITs, valued globally at $250 billion in 2024, are projected to double within seven year.

India is likely to mirror this trend, as reflected in a 60 percent year-on-year surge in industrial & logistics leasing in first half of 2025, with a 30 percent YoY rise in warehousing absorption and a three-time increase in institutional investment ($2.5 billion in 2024).

The report “Indian REITS: A Gateway to Institutional Real Estate” was unveiled on September 12 at the CREDAI NATCON in Singapore.

Despite its late entry compared to global peers, Indian REITs have strong fundamentals, ANAROCK Capital CEO Shobhit Agarwal said.

“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,” he said.

Share of REITs in the real estate market

According to report, Indian REIT market accounts for just 20 percent of institutional real estate, far below the US (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.

Out of the total REIT-worthy office stock of approximately 520 million sq ft in the top seven cities, 32 percent or 166 million sq ft is listed.

As the market matures, diversification is expected through data centres 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.

CREDAI president Shekhar Patel said 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,” he said.

The outlook

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, the report said.

Deep office market demand, rising institutional-grade stock, and a proactive regulatory environment support REITs in India.

As the sector diversifies into logistics, warehousing, retail, and data centres, India’s favourable demographics, rapid urbanisation, and sustained GDP growth will further reinforce its position as one of the most lucrative markets for institutional capital.