In its board meeting held today, SEBI has allowed real estate investment trusts (REITs) and infrastructure investments trusts (InvITs) to raise capital by issuing debt securities.
REITs invest in rent yielding commercial and residential properties to generate regular income while InvITs invest in infrastructure projects to generate income by way of toll.
In a circular, SEBI has announced certain changes in the REITs and InvITs regulations to facilitate growth.
Here are the other amendments:
- Introducing the concept of Strategic Investor for REITs on similar lines of InvITs
- Allowing single asset REIT on similar lines of InvIT
- Allowing REITs to lend to underlying Holdco/SPV
- Amending the definition of valuer for both REITs and InvITs
Further, the Board has, after deliberations, decided to have further consultation with the stakeholders on a proposal of allowing REITs to invest at least 50% of the equity share capital or interest in the underlying Holdco/SPVs, and similarly allowing Holdco to invest with at least 50% of the equity share capital or interest in the underlying SPVs.
SEBI rule mandate fund houses to invest up to 10% of NAV in REITs and InvITs. Currently, fund houses can also invest up to 5% in single issuer.
