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Reits

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Submitted By njuneja
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A real estate investment trust (REIT) is a company that owns, and in most cases, operates income-producing real estate. REITs own many types of commercial real estate, ranging from office and apartment buildings to warehouses, hospitals, shopping centers, hotels and even timberlands. Some REITs also engage in financing real estate. The REIT structure was designed to provide a real estate investment structure similar to the structure mutual funds provide for investment in stocks
Reits are like mutual funds, but instead of using the money collected from investors to buy stock and bonds, they invest in property.
REITs can be classified as equity, mortgage, or a hybrid.
Investors in Reits will earn two different types of income. The rental income earned by the property in which the Reit has invested will be distributed as dividends. This will be tax-free for investors, but the Reit will have to pay dividend distribution tax on these payouts. If the property held by Reit appreciates in value, the Net Asset Value (NAV) will go up and will lead to capital gains when the investor redeems his units.

Key points in proposed I-Reits.
- The minimum investment limit for an investor is Rs. 2 lakhs.

- Under I-REITs, 90% of dividend income is to distributed to investors

- Minimum size of Reit Rs. 500 crore and IPO size Rs. 250 crore.

- All Reits must be listed.

- A Reit can invest only 10 per cent of its assets in properties that are under construction. At least 80 per cent of the assets should be in properties that are completed and generating revenue.

The study will cover
- Scope of real estates in India

- Comparison between investments in Reits and in other options.

- Analysis of performance of Reits in other nations.

- Based on the analysis of above points, Performance forecasting of Reits in India.

Primary Analysis
- People perception towards the concept of Reits.

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