SEBI Supercharges REITs & InvITs: Institutional Floodgates Set to Open

India's market regulator just dropped a bombshell—and real estate investors are scrambling.

The move: SEBI's proposing to let more institutional players into REITs and InvITs. No more velvet-rope exclusivity for these asset classes.

Why it matters: When the big money flows in, liquidity follows. Expect these instruments to shake off their niche status faster than a crypto influencer abandoning a dead NFT project.

The cynical take: Wall Street's about to 'discover' Indian infrastructure assets—right after exhausting all the quick flips in Western markets.

QIBs may now qualify under revised definition

In a consultation paper issued on Friday to amend the definition of ‘strategic investor’ in a REIT or InvIT issue, it said it “proposed to amend the definition of Strategic Investor to provide that an entity who is considered a QIB under the ICDR (Issue of Capital and Disclosure Requirements)  Regulations, may apply as ‘Strategic Investor’.”

“It is noted that the extant definition of Strategic Investor includes only a select few investors,” the paper said, pointing out that the definition was narrow in scope and did not include many institutional investors like public financial institutions, insurance funds, provident funds, and pension funds who also make investments in units of REITs and InvITs “as it aligns with their investment mandate of long -term, stable, income generating investments.”

Due to the narrow definition, they were unable to apply for the units of REITs and InvITs in a public issue, and the trusts were unable to attract capital.

Compared to the current narrow definition of strategic investors, that of QIBs was wider, the paper noted.

It also said that foreign investors, other than individuals, corporate bodies, and family offices, WOULD also be included as strategic investors.

The last date for submitting comments is August 22.

Published on August 1, 2025