Hyderabad: India’sSmall and Medium Real Estate Investment Trusts (SM REITs) market is poised for substantial expansion, with total potential estimated to exceed $ 75 billion, supported by more than 500 million sq. ft. of eligible office, logistics, and retail assets, according to a new report by CBRE South Asia Pvt. Ltd.

The report, titled From Niche to Next Wave: SM REITs Forging Real Estate Investment Frontiers, highlights the rising appeal of SM REITs—investment vehicles that own or manage income-generating real estate assets valued between Rs50 crore and Rs500 crore. By enabling fractional ownership with relatively low minimum investments, SM REITs aim to broaden access to high-value commercial properties for smaller investors.

CBRE’s 2025 update builds on its benchmark 2024 study, reassessing the evolution of SM REITs and their growing role in strengthening India’s real estate investment ecosystem. Anshuman Magazine, Chairman & CEO for India, Southeast Asia, Middle East & Africa at CBRE, said SM REITs are transforming India’s property investment landscape by offering a structured, transparent, and scalable model for fractional ownership. “By bringing small- to mid-sized assets under a regulated umbrella, SM REITs can deepen institutionalisation, enhance property management standards, promote ESG compliance and create a more organised real estate ecosystem,” he said.

Premium office developments continue to anchor investor confidence, with Grade A+ commercial spaces forming the backbone of high-quality SM REIT portfolios. The report notes that these assets remain the primary drivers of institutional interest as the REIT and SM REIT markets evolve. Rami Kaushal, Managing Director, Consulting & Valuation Services, India, Middle East & Africa, CBRE, said SM REITs bridge the gap between direct property ownership and large-scale REITs. “This format could help investors secure stable rental income and benefit from capital appreciation. Successful adoption will depend on navigating regulatory frameworks and adapting to policy refinements,” he said.

The Securities and Exchange Board of India (SEBI) put in place a regulatory framework for SM REITs in 2024 by amending the SEBI (Real Estate Investment Trusts) Regulations, 2014, laying the groundwork for wider participation and improved transparency.

The CBRE report outlines multiple potential benefits for stakeholders. For investors, SM REITs could democratise access to premium commercial real estate while offering liquidity through stock exchange listing and robust governance mechanisms. For developers, they provide a tool for capital recycling, enabling funds from mid-sized assets to be channelled into new projects and expanding access to diverse investor pools.

Magazine emphasised that long-term success for the segment will rely on performance consistency, strong disclosures and investor confidence. “Investors must undertake rigorous due diligence, assessing both asset quality and manager capability,” he said. The report notes that its findings represent a scenario-based estimate and are limited to India’s top seven cities as of Q3 2025. It outlines sector-specific assumptions across office, logistics and retail assets, excluding existing REIT, InvIT and institutional portfolios.