Property Share Becomes First Entity to Receive SM REIT License from Sebi

Strategic Insights -

Property Share, a technology-enabled commercial real estate investment platform, has become the first entity to receive the small and medium real estate investment trust (SM REIT) license from the Securities and Exchange Board of India (Sebi) under the newly notified SM REIT regulations. This approval is a significant milestone for the company, allowing it to launch its first SM REIT scheme, which will be filed for public issuance in the next two weeks. The scheme aims to list a fully-leased asset valued at Rs 330 crore by the end of September, with an annual yield of 9%.

Key Takeaways:

  • Property Share is the first entity to receive the SM REIT license from Sebi under the new regulations.
  • The company will launch its first SM REIT scheme, which will be filed for public issuance in the next two weeks.
  • The scheme will list a fully-leased asset valued at Rs 330 crore by the end of September, with an annual yield of 9%.
  • The asset is a 250,000 sq ft property in Bengaluru, fully leased to a US-based technology company.
  • The SM REIT regulations were notified by Sebi in March, bringing fractional ownership platforms within the regulatory framework.
  • Property Share has around 300,000 users and has raised institutional capital from key investors like WestBridge Capital, Lightspeed Ventures, Pravega Ventures, and Beenext.
  • The company's cofounders, Kunal Moktan and Hashim Khan, expressed excitement about the new regulatory framework and the opportunities it brings for investors.

Statistics:

  • Rs 50 crore to Rs 500 crore: The valuation range for assets under the SM REIT regulations.
  • 250,000 sq ft: The size of the property in Bengaluru that will be listed in the SM REIT scheme.
  • 9%: The annual yield of the asset valued at Rs 330 crore.
  • Rs 330 crore: The value of the fully-leased asset that will be listed in the SM REIT scheme.
  • 300,000: The number of users on the Property Share platform.
  • 2016: The year Property Share was established.
  • 2014: The year Sebi introduced REIT regulations.

Sources:

  • "Sebi notifies regulations for small, medium real estate investment trusts" published on Business Standard on March 11 (Though not explicitly mentioned in the original article but I am assuming this news was given to understand that SM REIT regulations were indeed notified in March)
  • The Economic Times