Why is it in the News?

SEBI on Saturday decided to bring entities facilitating fractional investment in real estate under a regulatory framework, whereby they will be required to operate as Small and Medium Real Estate Investment Trusts.

About Real Estate Investment Trusts (REITs):

• A Real Estate Investment Trusts (REITs) is a company that owns and typically operates income-generating real estate or related assets.
• It pools funds from investors, directing them into various commercial real estate ventures, including office buildings, shopping malls, apartments, hotels, resorts, self-storage facilities, warehouses, and mortgages or loans.
• In contrast to conventional real estate firms, REITs don't develop properties for resale; rather, they acquire and develop properties primarily for inclusion in their investment portfolio.
• REITs offer individual investors an opportunity to share in the income generated by commercial real estate without the need to directly purchase such properties.
• Typically specializing in specific real estate sectors, REITs may focus on diversified or specialty portfolios, encompassing various property types like office and retail spaces.
• Most REITs are publicly traded on stock exchanges, similar to stocks, providing high liquidity compared to physical real estate investments.
• This stock-like nature allows investors to buy or sell REIT shares on the exchange at any time.