dennis

India’s big real estate developers are heading for new horizons. After raising funds from UK’s Alternate Investment Market (AIM), they are now moving to the Dubai International Financial Exchange (DIFX) and the Singapore Stock Exchange to float Real Estate Investment Trusts (Reits) as an "Alternate strategy to raise funds".

Unitech, DLF, Hiranandani Developers, Housing Development and Infrastructure, DS Kulkarni Developers, Orbit Corporation, Embassy group and Nitesh Estates are among real estate majors exploring options for listing their respective Reits at DIFX or the Singapore bourse. DIFX and Singapore market have emerged as the two new venues for Indian developers to raise funds. Both these markets have favourable regulations to float Reits


Indian developers are focusing to Reits because their traditional funding sources are restricted to the primary market and private equity. A Reit helps developers securitize their rental yields - lease income - from their commercial properties by issuing shares to financial institutions or retail investors. Currently, many Indian developers are working to bring their income generating commercial properties under a special purpose vehicle (SPV) or a subsidiary company, which will then be listed in the overseas market in the form of a Reit.