India opens up market with a step in the Reit direction

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By Rashmi Kumar, Rev Hui
14 Aug 2014

After years of discussions, the Securities and Exchange Board of India (Sebi) has finally approved the setting up of real estate investment trusts (Reits) and infrastructure investment trusts (InvITs). Market watchers hailed the move as a step in the right direction, but before issuers and investors go into action, concerns over tax and valuation need to be cleared up, write Rashmi Kumar and Rev Hui.

Under the rules approved on August 10, India-listed Reits can only invest in commercial assets such as office buildings, either directly or through special purpose vehicles (SPVs). The total value of a Reit must be above Rp5bn ($82m), while the amount it raises through an IPO has to be ...

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