Boosting Real Estate & Infra Trusts with Bigger Institutional Backing.

SEBI Proposes Wider Strategic Investor Pool for REITs & InvITs to Attract Institutional Capital

The Securities and Exchange Board of India (SEBI) has proposed to broaden the definition of strategic investors under the REIT (Real Estate Investment Trust) and InvIT (Infrastructure Investment Trust) norms. The move aims to attract a broader base of institutional capital by including Qualified Institutional Buyers (QIBs) and select categories of Foreign Portfolio Investors (FPIs). Currently, strategic investor eligibility is limited, excluding major long-term players like pension funds, provident funds, and insurance funds. SEBI now recommends allowing entities recognised as QIBs under ICDR regulations—such as public financial institutions, large pension or provident funds, and armed forces or postal insurance funds—to qualify as strategic investors. However, FPIs that are individuals, corporations, or family offices would remain excluded. Strategic investors must contribute at least 5% of the offer size and can invest up to 25%, with a 180-day lock-in post-listing. Public feedback on the proposal is open until August 22.