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India’s REIT market remains significantly under-penetrated compared with global peers, which points to substantial long-term growth potential.
India currently has five listed REITs — four focused on office assets and one in the retail segment.
India’s Real Estate Investment Trust (REIT) market remains significantly under-penetrated compared with global peers, but this gap also points to substantial long-term growth potential as the ecosystem matures and diversifies, according to a new report by Vestian. It said the country’s REIT market capitalisation is expected to rise from about $18 billion in 2025 to $25 billion by 2030.
As of Q3 2025, REITs account for just 19% of India’s listed real estate value, far below the global average of 57%. In contrast, in mature markets such as the US and Australia, more than 95% of listed real estate is held within REIT structures. India’s REIT market capitalisation also represents only 0.4% of the overall stock market, underlining how early the segment still is.
India currently has five listed REITs — four focused on office assets and one in the retail segment. This concentration reflects the early stage of the market, as most other real estate asset classes are yet to reach the scale, stability and institutional readiness required for REIT listings.
Office assets remain the backbone
Although REIT regulations were notified in 2014, India’s first REIT listing came only in 2019. Since then, the sector has expanded rapidly, with total market size growing from Rs 26,400 crore in FY20 to Rs 1.6 lakh crore by Q2 FY26.
Office assets continue to dominate India’s REIT landscape. Listed office REITs now cover more than 135 million square feet, supported by steady demand from global capability centres (GCCs), technology firms and BFSI occupiers. These assets typically deliver stable yields of 5–7%.
India has over 1 billion square feet of office stock, of which nearly 500 million square feet is considered REIT-ready. Around 34 million square feet is already part of existing REIT pipelines. Developers are increasingly looking to monetise this potential, with Bagmane Developers — backed by Blackstone — expected to launch a Rs 4,000 crore REIT IPO in early 2026.
Retail REITs: a large untapped pool
Retail REITs have been slower to take shape, largely due to dependence on footfall trends, consumption cycles and long-term asset management. At present, Nexus Select Trust is India’s only retail REIT, despite the country having around 89 million square feet of Grade A retail stock.
Only about 10.6 million square feet of this space is currently under REITs, leaving a sizeable institutional opportunity. Vestian estimates that REIT-ready retail assets could grow from Rs 1.5 lakh crore in 2025 to Rs 2.4 lakh crore by 2030, with two to three new retail REIT listings likely over the next three to five years. The retail REIT market could reach $6-9 billion by 2030, supported by emerging consumption hubs such as Indore, Coimbatore, Surat, Chandigarh and Bhubaneswar.
New asset classes set to drive next phase
Beyond offices and retail, alternative asset classes such as warehousing, industrial parks, logistics facilities and data centres are expected to be the next growth engines. Industrial and warehousing REIT and InvIT opportunities are projected to expand from Rs 0.7 lakh crore to Rs 1.3 lakh crore by 2030, broadly in line with global trends.
“India’s REIT market holds huge upside potential, given its low penetration and the need to move beyond offices and selective retail,” said Shrinivas Rao. “As the market evolves, asset classes such as data centres, logistics, industrial parks and warehousing offer scalable, yield-bearing opportunities aligned with mature global REIT markets.”
Residential REITs remain a long-term play
Residential real estate, while large in size, is not yet REIT-ready in India. Low rental yields of 2-3%, fragmented ownership, high tenant churn and the absence of a unified rental housing policy continue to pose challenges. Emerging formats such as co-living, student housing and senior living offer some promise, but residential REITs are still a longer-term prospect.
Rao said innovation in rental formats and policy support could gradually improve viability, adding that Small and Medium REITs (SM-REITs) may help bridge gaps by aggregating smaller stabilised assets.
SM-REITs and policy support
Regulatory initiatives such as SM-REITs — covering portfolios valued between Rs 50 crore and Rs 500 crore — are seen as an important step towards broadening participation. Platforms such as PropShare Platina (2024) and PropShare Titania (2025) are already operational, with more expected as smaller commercial assets move into formal, transparent structures.
Outlook
Vestian expects India’s REIT market capitalisation to rise from about $18 billion in 2025 to $25 billion by 2030. With REIT-able office assets projected to double in value over the same period, alongside growing retail and alternative asset pipelines, India is positioned to emerge as one of the fastest-growing REIT markets globally.
The next phase, the report notes, will be driven by diversification, scale and policy coherence — factors that could transform India’s REIT platform into a broad, multi-sector investment universe.
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January 10, 2026, 1:43 PM IST
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