REIT and InvIT Assets Could Reach ₹20 Lakh Crore by FY31 as Real Estate and Infrastructure Monetisation Accelerates
New Delhi | September 24, 2026: India’s REIT and InvIT markets could nearly double in size over the next five years, with their combined assets under management projected to reach around ₹20 lakh crore by FY31, up from approximately ₹10 lakh crore in FY26, according to ICRA.
The expansion could increase the flow of institutional capital into commercial property, roads, transmission, renewable energy, warehousing and data centres, creating a larger investment and monetisation ecosystem around income-generating real estate and infrastructure assets.
Combined AUM Could Double in Five Years
ICRA expects the combined AUM of Infrastructure Investment Trusts (InvITs) and Real Estate Investment Trusts (REITs) to grow at a compound annual growth rate of around 15% between FY26 and FY31.
Its projections put:
- InvIT AUM at around ₹13.5 lakh crore by FY31
- REIT AUM at around ₹6.5 lakh crore by FY31
- Combined AUM at approximately ₹20 lakh crore
The projected growth reflects increasing monetisation of operational infrastructure and the expansion of listed real estate investment structures.
Roads and Transmission Drive the InvIT Market
InvIT AUM has already expanded significantly.
According to ICRA, InvIT AUM increased from around ₹3.2 lakh crore in March 2021 to ₹7 lakh crore in March 2026, representing a CAGR of about 17%.
Road assets have become a much larger component of the market, accounting for 43% of InvIT AUM in March 2026, compared with 16% in March 2021.
Telecom remained the largest segment marginally, with a 44% share.
ICRA expects continued monetisation of roads and transmission assets, along with growth in renewable energy and fibre platforms, to support further InvIT expansion.
REITs Move Beyond Traditional Office Assets
REITs have recorded even faster growth over the same five-year period.
Their AUM increased from approximately ₹70,000 crore in March 2021 to ₹3.1 lakh crore in March 2026, translating into a CAGR of about 33%, according to ICRA.
Office properties continue to dominate REIT portfolios, but the asset mix is gradually broadening.
Newer opportunities include:
- Retail properties
- Warehousing
- Data centres
- Other income-generating commercial assets
This diversification could give property owners and developers additional routes to monetise completed or operational assets.
Why Commercial Property Owners Should Care
A larger REIT market could create more potential avenues for institutional capital to enter commercial real estate.
For property owners and developers, REIT structures can provide a mechanism to unlock capital from operational assets while allowing investors to participate in income-generating properties.
The expansion into warehousing and data centres is also significant because these sectors are increasingly becoming part of India's commercial real estate investment landscape.
However, inclusion in a REIT structure depends on factors such as asset quality, scale, income visibility, regulatory requirements and investor demand.
Regulatory Changes Could Expand REIT Funding
ICRA expects recent regulatory changes to improve access to domestic institutional capital.
REITs were reclassified as equity for mutual fund investment purposes in January 2026. Banks are also scheduled to be permitted to lend directly at the REIT level from October 1, 2026.
The definition of strategic investors has additionally been expanded to include all qualified institutional buyers.
According to ICRA, these changes could increase the pool of long-term capital available to REITs and improve access to longer-tenure debt and refinancing.
Domestic Institutional Participation Is Rising
Domestic institutional participation in the segment has also increased.
ICRA said mutual fund exposure to REITs and InvITs rose 56% year-on-year to more than ₹31,000 crore as of June 2026.
Insurers, pension funds, sovereign funds and retail investors have also increased their participation.
ICRA further noted that seasoned issuances have generated a median extended internal rate of return of around 14%, while borrowing spreads compared with government securities and AAA-rated corporate bonds have narrowed.
These figures describe historical market performance and funding conditions; they do not guarantee future returns.
What Happens Next
India had 25 InvITs and six publicly listed REITs as of FY26, according to ICRA.
Over the next five years, the rating agency expects continued asset monetisation, broader participation from domestic institutions and the development of new REIT investment avenues to drive market expansion.
For commercial real estate, the projected growth means a potentially larger institutional ownership and financing ecosystem, particularly across offices, retail, warehousing and data centres.
The key question for property markets will be how quickly new assets can meet the scale, income and regulatory requirements needed to enter these investment platforms.