REIT units allotted to sponsors are now required to have only 15% of the units in a three-year lock-in

SEBI has reduced the quantum of units allotted to sponsors of REITs (Real Estate Investment Trusts) to be placed under a three-year lock-in to 15%. Earlier, 25% of the preferential units allotted to the sponsors of the REITs were required to be under a three-year lock-in from the date of trading approval.

The recommendation for this change was made by the Hybrid Securities Advisory Committee (HySAC). The regulator aims to promote ease of business with this change.

The regulator has also specified that the transfer of units from one sponsor to the other sponsor can be done with the units continuing to be under the lock-in and the transferee will not be eligible to transfer such units till the end of the lock-in period. The transfer of units can be made only with the entities of the sponsor.

This circular has come into effect immediately.