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CAPITAL RAISING • SMALL & MEDIUM REIT FRAMEWORK

Unlocking Fractional Commercial Real Estate via SM REITs

Empowering mid-sized real estate sponsors to list commercial assets valued between ₹50 Cr and ₹500 Cr under SEBI's new framework.

Book Mandate Consultation Check Diagnostic & Tools

₹50 Cr – ₹500 Cr

Asset Value Range

₹10 Lakh

Minimum Investment

95% Completed

Rent-Generating Mandate

SM REIT Regulations 2024

SEBI Amendment

STRATEGIC OVERVIEW

Promoter-First Advocacy in SM REIT Structuring & Listing

In March 2024, SEBI notified groundbreaking amendments creating the Small and Medium Real Estate Investment Trust (SM REIT) framework. This revolutionary regulatory move formalizes India's rapidly growing fractional real estate ownership market, allowing developers and asset owners with commercial portfolios valued between ₹50 Cr and ₹500 Cr to issue regulated public units. Prior to this framework, only mega-developers with ₹500 Cr+ assets could access REIT markets. Now, mid-market developers owning single commercial buildings, warehousing units, or retail spaces can create an SM REIT scheme, issue units with a low minimum investment ticket size of ₹10 Lakh, and list them on stock exchanges. Glocal Consultants is at the forefront of structuring India's first generation of SM REITs.

DELIVERABLES & SCOPE

What Glocal Delivers on Your Mandate

SM REIT Eligibility & Asset Screening

Screening commercial properties to ensure compliance with the 95% completed and rent-generating requirement.

Investment Manager Net Worth Advisory

Structuring the Investment Manager entity to fulfill the statutory ₹20 Cr net worth (with ₹10 Cr liquid net worth) norm.

Scheme-Specific SPV Architecture

Establishing distinct schemes under the SM REIT trust, allowing separate SPVs with ring-fenced financials and property titles.

Draft Scheme Document Preparation

Drafting statutory scheme information documents, including lease cash flow projections and certified independent valuation reports.

Fractional Ownership Platform Migration

Assisting existing Fractional Ownership Platforms (FOPs) to seamlessly transition unregulated SPV structures into SEBI-compliant SM REITs.

Listing on BSE / NSE Dedicated Segments

Coordinating with stock exchanges for the initial public offer and secondary market trading of SM REIT scheme units.

REGULATORY BENCHMARKS

Statutory Eligibility & Criteria

Governed under SEBI (Real Estate Investment Trusts) (Amendment) Regulations, 2024:

Statutory Metric	Regulatory Requirement
Scheme Asset Value	Asset value of each scheme must be between ₹50 Cr and ₹500 Cr
Rent-Yielding Threshold	At least 95% of scheme assets must be fully completed and rent-generating (max 5% under-construction)
Manager Net Worth	Investment Manager must possess net worth of at least ₹20 Cr (minimum ₹10 Cr unencumbered liquid net worth)
Minimum Unitholders	Minimum of 20 distinct public investors required for each scheme (excluding sponsor/manager)
Minimum Ticket Size	Minimum investment per investor is ₹10 Lakh (down from informal ₹25 Lakh FOP thresholds)

EXECUTION WORKFLOW

5-Stage Milestone Roadmap

Asset & Title Verification

Forensic title search, tenant lease agreement verification, and formal valuation by SEBI registered valuer.

Manager & Trust Incorporation

Incorporating Investment Manager entity, capitalizing with ₹20 Cr net worth, and registering Trust with SEBI.

Scheme SPV Formation

Setting up SPV holding 100% of the rent-generating property and establishing scheme accounts.

Scheme Document Filing

Filing Draft Scheme Offer Document with SEBI and stock exchanges for public comments.

Scheme Unit Offering & Listing

Raising minimum ₹50 Cr from at least 20 investors, unit allotment, and listing on stock exchange.

VALUE REALIZATION

Strategic Advantages for Issuers

✓Access to Institutional Capital for Mid-Market Properties (₹50 Cr to ₹500 Cr)

✓High Retail & HNI Liquidity with Affordable ₹10 Lakh Minimum Investment Ticket Size

✓Full Regulatory Legitimacy Eliminating Legal Uncertainty for Fractional Real Estate

✓Retain Asset Management and Property Maintenance Fees as Investment Manager

✓Tax Pass-Through Benefits for Investors Under Regulated Income Tax Provisions

✓Capital Recycling to Fund New Development Projects Without High-Cost Debt

FREQUENTLY ASKED QUESTIONS

Mandate FAQs & Clarifications

A Mainstream REIT requires minimum assets of ₹500 Cr with an 80% rent-generating rule and allows general pooling. An SM REIT caters to assets between ₹50 Cr and ₹500 Cr, requires 95% completed rent-generating assets, and operates via distinct schemes for individual properties.

Strategic Promoter Access

Schedule a Consultation for SM REIT Structuring & Listing

Schedule an exclusive, non-disclosure advisory session with our senior capital markets partners. We evaluate your listing feasibility, capital structure, and valuation multiples.

Confidential Advisory RequestAll discussions strictly covered under bilateral Non-Disclosure (NDA).

Partner Desk

Direct Partner Contacts

Direct Advisory Hotline

+91 96257 55789

Corporate Inquiries

info@glocalconsultants.com

Corporate Headquarters

Glocal Consultants Private Limited
C-1119, KLJ Noida One,
Sector 62, Noida - 201309

Hours: Mon – Fri: 9:30 AM – 6:30 PM IST
Advisory desks in Noida, Mumbai & Bangalore