The Small and Medium Real Estate Investment Trusts (SM REITs) market in India is projected to exceed USD 75 billion, drawing from a pool of more than 500 million sq. ft. of eligible office, logistics and retail assets, according to CBRE South Asia Pvt. Ltd’s latest report titled, ‘From Niche to Next Wave: SM REITs Forging Real Estate Investment Frontiers’.

REITs own, operate, or finance income-producing real estate across a range of sectors. They allow people to buy units, often with a relatively low minimum investment, allowing small investors to access high-value commercial real estate. SM REITs control smaller properties, valued between Rs 50 crore and Rs 500 crore.

Building on CBRE India Research’s benchmark 2024 report, this 2025 update strategically re-examined the product’s evolution and its potential to substantially bolster the Indian real estate sector.

Anshuman Magazine, Chairman & CEO, India, Southeast Asia, Middle East & Africa, CBRE, said that SM REITs are redefining India’s real estate investment landscape by creating a structured, transparent, and scalable framework for fractional ownership. “This segment is anticipated to significantly deepen the institutionalisation of India’s commercial real estate. By bringing small-to-mid-sized assets under a regulated umbrella, SM REITs also have the potential to drive higher standards of property management, promote ESG compliance, and ultimately contribute to a more organised and efficient real estate ecosystem,” he said.

As India’s REIT and SM REIT ecosystem evolves, premium office assets continue to remain the core driver of institutional interest and investor confidence. These investment-grade developments, characterised by Grade A+ commercial specifications, often serve as the foundational pillars of a high-quality portfolio.

Rami Kaushal, Managing Director, Consulting & Valuation Services, India, Middle East & Africa, CBRE, said, “SM REITs have the potential to bridge a crucial gap between direct ownership and large-scale REITs. This structure could also enable investors to generate stable rental income and benefit from potential capital appreciation on high-quality assets. As the market evolves, the ability of stakeholders to navigate a nascent regulatory environment and adapt to policy refinements will be critical in positioning SM REITs as a long-term cornerstone of India’s real estate investment landscape.”

In 2024, the Securities and Exchange Board of India (SEBI) established a regulatory framework for SM REITs through amendments to the SEBI (Real Estate Investment Trusts) Regulations, 2014.

The report also outlined the strategic benefits SM REITs could offer to key stakeholders across the real estate value chain. For investors, SM REITs could provide democratised access to premium assets, potentially offering the dual advantage of stable passive income and capital appreciation, supported by liquidity through exchange listing and transparent governance mechanisms.

For developers, SM REITs could provide strategic capital management for mid-sized assets, potentially enabling efficient capital recycling into new projects and expanding access to a broader investor base.

Anshuman Magazine said that the long-term maturity of this segment will depend on consistent performance, disclosure discipline, and sustained investor confidence.

“Success for investors will require rigorous due diligence, carefully assessing the investment manager’s capabilities and the strength of the underlying assets,” he added.