Markets Updates | Economy for UPSC 2024 (Pre & Mains) PDF Download

 Page 1


MARKETS
UPDATES
Page 2


MARKETS
UPDATES
REAL ESTATE INVESTMENT TRUSTS
(REITS)
REITs are mutual fund like institutions 
that enable investments into the real estate sector by pooling small 
sums of money from multitude of individual investors for directly 
investing in real estate properties 
so as to return a portion of the income (after deducting 
expenditures) 
to unit holders of REITs, who pooled in the money.
Page 3


MARKETS
UPDATES
REAL ESTATE INVESTMENT TRUSTS
(REITS)
REITs are mutual fund like institutions 
that enable investments into the real estate sector by pooling small 
sums of money from multitude of individual investors for directly 
investing in real estate properties 
so as to return a portion of the income (after deducting 
expenditures) 
to unit holders of REITs, who pooled in the money.
REAL ESTATE INVESTMENT TRUSTS
(REITS)
REITs are set up as trust under the provisions of the Indian Trusts Act, 1882 and 
are registered with SEBI. 
Like a mutual fund, it has three parties –
Trustee, Sponsor(s) and Manager - to avoid any conflict of interest issues.
A REIT in India is allowed to invest mainly in completed and revenue generating 
assets 
and other approved investments. 
Further, REIT will have to distribute majority of its income among the unit 
holders.
Page 4


MARKETS
UPDATES
REAL ESTATE INVESTMENT TRUSTS
(REITS)
REITs are mutual fund like institutions 
that enable investments into the real estate sector by pooling small 
sums of money from multitude of individual investors for directly 
investing in real estate properties 
so as to return a portion of the income (after deducting 
expenditures) 
to unit holders of REITs, who pooled in the money.
REAL ESTATE INVESTMENT TRUSTS
(REITS)
REITs are set up as trust under the provisions of the Indian Trusts Act, 1882 and 
are registered with SEBI. 
Like a mutual fund, it has three parties –
Trustee, Sponsor(s) and Manager - to avoid any conflict of interest issues.
A REIT in India is allowed to invest mainly in completed and revenue generating 
assets 
and other approved investments. 
Further, REIT will have to distribute majority of its income among the unit 
holders.
REITS are regulated by the securities market regulator in India-
Securities and Exchange Board of India (SEBI)
REIT can invest in commercial real estate assets, either directly or 
through Special Purpose Vehicle (SPVs) 
which invests more than 80% of its assets in properties. 
REAL ESTATE INVESTMENT TRUSTS
(REITS)
Page 5


MARKETS
UPDATES
REAL ESTATE INVESTMENT TRUSTS
(REITS)
REITs are mutual fund like institutions 
that enable investments into the real estate sector by pooling small 
sums of money from multitude of individual investors for directly 
investing in real estate properties 
so as to return a portion of the income (after deducting 
expenditures) 
to unit holders of REITs, who pooled in the money.
REAL ESTATE INVESTMENT TRUSTS
(REITS)
REITs are set up as trust under the provisions of the Indian Trusts Act, 1882 and 
are registered with SEBI. 
Like a mutual fund, it has three parties –
Trustee, Sponsor(s) and Manager - to avoid any conflict of interest issues.
A REIT in India is allowed to invest mainly in completed and revenue generating 
assets 
and other approved investments. 
Further, REIT will have to distribute majority of its income among the unit 
holders.
REITS are regulated by the securities market regulator in India-
Securities and Exchange Board of India (SEBI)
REIT can invest in commercial real estate assets, either directly or 
through Special Purpose Vehicle (SPVs) 
which invests more than 80% of its assets in properties. 
REAL ESTATE INVESTMENT TRUSTS
(REITS)
REITs are given "pass through status" from the perspective of income tax. 
Pass Through Transactions 
They are those transactions where the ultimate beneficiary, namely, the investor 
receives the income (as dividends or interests payments) arising out of the 
loans/bonds/transactions done by a Trust. 
Since income is ultimately going to the investor, 
the Trust is exempted from paying the tax while the ultimate beneficiary is taxed. 
Thus, rental income from real estate assets directly held by REITs are allowed to pass through 
and are taxed in the hands of the unit holders of the REIT.
The rental income of REITs from their own assets will have pass through facility.
REAL ESTATE INVESTMENT TRUSTS
(REITS)