Indian Office REITs Outperform BSE Realty Index Amid "Heightened Demand": Report.

India's office Reit stocks have outperformed the BSE Realty Index, with all three office Reit stocks delivering over 15% capital appreciation in the past 12 months. The strength of India's office real estate market, driven by heightened demand from global capability centers, engineering and manufacturing, and financial sector firms, has contributed to this outperformance. A fourth office Reit, Knowledge Realty Trust, is expected to list by the end of the year, becoming one of the largest REITs in India.

India's office real estate investment trust (REIT) stocks have shown remarkable resilience and growth, outperforming the BSE Realty Index over the past 12 months. According to a report by Cushman & Wakefield, all three office REITs—Mindspace Business Parks REIT, Brookfield India REIT, and Embassy Office Parks REIT—delivered more than 15% capital appreciation [1].

The performance of these REITs can be attributed to the robust demand for office spaces, particularly from global capability centers (GCCs), engineering and manufacturing firms, and financial sector companies. GCCs alone accounted for 28-29% of the nationwide gross leasing volume over the last four quarters, with REITs capturing a significant share of this demand [1].

The entry of a fourth office REIT, Knowledge Realty Trust, is expected to further boost the Indian REIT market. Backed by Blackstone and Sattva Developers, Knowledge Realty Trust is poised to become one of the largest REITs in India, with 48 million square feet of grade A office space [1].

The Indian REIT market continues to grow, with strong economic fundamentals and supportive regulatory frameworks driving its expansion. While mature markets like Japan, Singapore, and Hong Kong focus on operational efficiencies, India is set to carve a significant trajectory in the REIT sector [1].

References:
[1] https://www.business-standard.com/industry/news/indian-office-reits-outperform-bse-realty-index-on-gcc-demand-125071700184_1.html