SM REITs regulations to give a boost to fractional investment, safeguard investor interests

financialexpress.com:

In a bid to regulate the fractional ownership industry, the Securities and Exchange Board of India (Sebi) has issued regulations to amend the REIT Regulations 2014, establishing norms for creation of Small and Medium Real Estate Investment Trusts (SM REITs). The move is aimed at regulating and organizing the fractional ownership industry as well as protecting the interests of investors.

The Sebi notification to the SM REITs regulations has come in just less than 3.5 months since the initial approval given by the regulator in setting up of SM REITs which, according to real estate experts, clearly reflects SEBI’s confidence on the potential of the fractional ownership model in democratizing access of retail investors into real estate.

“It is a watershed moment that will act as a catalyst in enhancing market efficiency and increase awareness among potential investors about the benefits of this investment avenue and ensure widespread adoption,” said Shiv Parekh, Founder and CEO, hBits.

Also Read: Credit Scoring System: How credit bureaus make money off your financial issues and haunt your future

Commenting on the notification, Saurabh Vohara, Founder & CEO at ALYF, said, “The SM REIT’s regulations have given a positive pathway for fractional ownership. These regulations safeguard the interests of investors and service providers alike.”

Sebi has introduced these regulations to accommodate smaller asset worth Rs 50 crore to Rs 500 crore with a minimum investment threshold of just Rs 10 lakh for investors.

“As a holiday home fractional ownership platform, we at ALYF are ecstatic by the inclusion of the residential sector along with commercial in this regulation. This allows us to ensure that are investors get easy exits and