InvestorQ : Is it true that DLF and GIC are planning to launch a REITS issue in India?
diksha shah made post

Is it true that DLF and GIC are planning to launch a REITS issue in India?

Rutuja Nigam answered.
8 months ago

With the REIT space heating up rapidly, there is more good news on the REIT launches. After successful launches by Mindspace and Embassy, it could be the turn of DLF to monetize its commercial rent yielding properties via REIT in association with GIC of Singapore.

It has been reported that India’s largest real estate developer, DLF, and the Government Investment Corporation of Singapore (GIC) plan to launch their real estate investment trust or REIT over the next 15-18 months to effectively monetize their commercial assets.

Under the REIT proposed to be launched, most of the rent yielding properties of DLF will be monetized through the REIT route. GIC already has a strategy stake in the commercial ventures of DLF over the last three years.

In the last couple of years, key players like Mindspace and Embassy have monetized their commercial assets through REITs and these have been quite successful post listing. In fact, Embassy did the first REIT in 2019 and Mindspace followed up in 2020.

The subject of the monetization will be DLF Cyber City; which houses the commercial rent yielding properties of the joint venture. The JV is jointly owned by DLF and GIC of Singapore with DLF holding a 66.67% stake and GIC of Singapore having a 33.33% stake.

GIC had invested close to Rs.9000 crore for this stake and the total property ownership is spread across 33 million SFT. The first step would be to structure the REIT properly. REIT offers an effective method for HNIs to participate in commercial real estate property with favorable tax treatment.