Real Estate: How can you maximise wealth with MSM REITs investments?
Also Read: MSM REITs: How SEBI's game-changing move will transform India's real estate investment landscape In simple terms, REITs own a portfolio of commercial properties and investors can purchase units of REITs to gain exposure to this portfolio. Similar to investing in units of a mutual fund scheme, investors gain exposure to the portfolio of assets the scheme owns.
REITs manage those properties and collect rentals from the tenants occupying them, which is further distributed to its investors. Currently, there are four listed REITs in India, 2 sponsored by top developers namely Embassy REIT and Mindspace REIT and 2 sponsored by investment managers namely Brookfield REIT and Nexus REIT.
Each of these 4 REITs have a diversified portfolio of underlying properties across Tier 1 and Tier 2 cities in India. However, certain investors want to gain exposure to specific assets, where they know the entire characteristics like the property, tenant, lease structure, yield profile etc.
This is where MSM REITs will enable investors to make property specific investments. Extending our example of regular REITs being equivalent to owning units of a mutual fund scheme, MSM REITs can be thought of as being equivalent to owning a share of a single company.
It would allow investors to create their own customized portfolio based on their own unique requirements, just like investors can create their own portfolio by picking up shares in multiple stocks.
Also Read: Are real estate investors keen on fractional real estate? 3 experts share insights An investor should understand and research extensively the underlying asset held by a MSM REIT. To get an investor started on the research, have listed a few parameters which an investor should look
