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REITs eye strong expansion on high demand for office space
Bengaluru: India’s real estate investment trusts, or REITs, are doubling down on expansion through acquisitions and greenfield development, backed by sustained demand for high-quality offices. Amid the growth push, they are set to compete with each other and with funds and wealth management platforms for premium commercial assets, while also tapping sizeable pipelines from their own sponsors.
Most of them who have substantial projects under development will boost leasing and expand their portfolios.
In the June quarter, REITs recorded higher revenue, net income, distribution to unit holders, along with healthy leasing. The momentum in the office sector has stayed strong despite the ongoing geopolitical turmoil and uncertainty over the impact of artificial intelligence (AI), prompting REITs to double down on growth.
India now has six real estate investment trusts—five in office and one in retail—backed by global asset managers such as Blackstone and Brookfield, and leading office developers. Together, the six trusts manage over 214 million sq ft of top office and retail assets across India.
“We will look for acquisitions of the right asset at the right price. We also have a 1.4 million sq ft under construction at Global City office park, in Bengaluru and another 1.2 million sq ft that will go live. So, with potential third-party acquisitions, ROFO (right of first offer) assets, project development, and some embedded growth within, there is strong growth potential going forward,” Shirish Godbole, chief executive of Knowledge Realty Trust (KRT), which is backed by developer Sattva Group and Blackstone, told Mint.
Right of first offer typically grants a REIT the chance to buy an asset from its sponsors. REITs also buy assets through third-party acquisitions.
KRT has four ROFO assets of 6 million sq ft in Bengaluru, Chennai and Pune, while ‘Image Tower’, a commercial property of 1.6 million sq ft in Hyderabad, will be completed next year and may be offered by the sponsor to KRT.
The five office REITs—Brookfield India Real Estate Trust (Biret), Embassy Office Parks REIT, Mindspace Business Parks REIT, Knowledge Realty Trust and Bagmane Prime Office REIT—and the retail-focused Nexus Select Trust had gross assets under management (AUM) of more than ₹3.17 lakh crore as of June end.
The combined market capitalization of these REITs was at more than ₹2.17 lakh crore as of 11 August, the Indian REITs Association (IRA) said in a release.
“We are looking at both the sponsor and third-party acquisitions; this 12-13 million sq ft pipeline is across the top six cities in India. On the leasing front, we signed 1.3 million sq ft across 17 deals in the first quarter, welcoming 10 new occupiers into our portfolio," Embassy REIT chief executive officer Amit Shetty said in its recent earnings call.
Most occupants are large, global enterprises with annual revenues exceeding $1 billion and a number of them are deeply embedded in the AI ecosystem. Embassy REIT's total development pipeline was at 6.2 million sq ft, with around 60% pre-leased for deliveries scheduled over the next 24 months.
The youngest listed REIT, Blackstone-backed Bagmane Prime Office REIT, has a massive 47 million sq ft pipeline of projects that it can buy from sponsors. Similarly, Brookfield-led Biret has been actively buying front office space and large campuses to expand, and wants to acquire more.
“The focus is on growth. Our guidance is also for growth, in NAV (net asset value) enhancement and distribution,” said Ankur Gupta, deputy chief investment officer, head of Asia Pacific and Middle East, real estate, Brookfield, in an analyst call.
Biret has a robust sponsor group pipeline, and is open to third-party acquisitions. In August, Biret and Prime Offices Fund signed binding agreements to acquire office space in Mumbai's Bandra-Kurla Complex (BKC) for an enterprise value of ₹1,700 crore.
In November 2025, Brookfield REIT said it had entered into a binding agreement to acquire a 100% interest in Ecoworld, a 7.7 million sq ft grade-A office campus in Bengaluru for ₹13,125 crore, in the largest transaction by a real estate investment.
Mindspace REIT also has a strong development pipeline within the portfolio of 10.2 million sq ft, which together with vacant area leasing, contractual escalations, mark to market rental growth, will add almost ₹1,700-1,800 crore to its net operating income in the next three years.
“Our portfolio is diversified today and expanded to 46.2 million sq ft. The occupancy of the portfolio is now at 95.8% and should go up to 97%. The key focus now is how do we get new development opportunities,” said Ramesh Nair, managing director and chief executive, Mindspace REIT.
Source: Livemint