DLF, Prestige Estates Gain on Nod for Establishing REITs

Commercial real estate developers like DLF, Prestige Estate, Phoenix Mills and Oberoi Realty gained on Monday as the market regulator Securities and Exchange Board of India (SEBI) on Sunday approved the setting up of real estate investment trusts (REITs) which will help these companies raise additional source of capital by monetising their rent generating commercial real estate properties.

REITs are listed entities that mainly invest in income-generating real estate assets, the earnings of which are mostly distributed to their shareholders. They generally get special tax treatment.

The Sebi on Sunday said REITs should operate with a minimum asset pool of at least Rs 500 crore and have an initial issue size of at least Rs 250 crore for shareholders.

As of 9.25 a.m. DLF traded 3.68 per cent higher at Rs 201.25 whereas Prestige Estate was up 3.05 per cent at Rs 251.95. Phoenix Mills and Oberoi Realty were up 4.65 per cent and 3.17 per cent respectively.

(With inputs from Reuters)