Which REITs are Yielding High Returns?

Real Estate Investment Trusts (REITs) have transformed the way people invest in real estate. Instead of purchasing and managing physical properties yourself, REITs allow you to invest in large, income-generating real estate—like office buildings, shopping malls, and residential complexes—without the usual hassles. For many investors, REITs offer the perfect balance of steady income, diversification, and liquidity.

In India, REITs started gaining momentum in 2014 when the Securities and Exchange Board of India (SEBI) introduced regulations to streamline and standardize them. Since then, REITs have become a popular way for Indian investors to tap into the real estate market, offering both attractive dividends and potential capital appreciation.

Top REIT Stocks in India for 2025

Here are some of the most promising REITs to watch this year:

🏢 Mindspace Business Parks REIT (MINDSPACE)

• Sector: Office Real Estate
• Price: ₹418.47
• Dividend Yield: 6.63%
• 1-Year Return: 22.27%

Mindspace focuses on premium office spaces across major Indian cities. Its properties attract large corporate tenants, making it a reliable source of rental income.

🛍️ Nexus Select Trust (NXST)

• Sector: Retail Real Estate
• Price: ₹146.45
• Dividend Yield: 4.77%
• 1-Year Return: 1.62%

NXST owns and manages popular shopping malls in prime locations. While retail has faced challenges during economic slowdowns, Nexus Select Trust has maintained stable occupancy rates, making it a good long-term investment for conservative investors.

🏙️ Embassy Office Parks REIT (EMBASSY)

• Sector: Office Real Estate
• Price: ₹385.43
• Dividend Yield: 6.77%
• 1-Year Return: 5.31%

India’s first publicly listed REIT, Embassy Office Parks, is known for its large-scale business parks that host multinational corporations. Its diversified tenant base ensures stable cash flow and consistent dividends.

🏢 Brookfield India Real Estate Trust (BIRET)

• Sector: Office Real Estate
• Price: ₹318.60
• Dividend Yield: 12.04%
• 1-Year Return: 18.40%

Brookfield India Real Estate Trust primarily invests in commercial office spaces in top business districts. Its high dividend yield makes it particularly attractive for income-focused investors.

Disclaimer: This list is for educational purposes only. Always do your own research or consult a financial advisor before investing.

Types of REITs in India

REITs are not all the same. Here’s a quick overview:

• Equity REITs: Generate income mainly through renting out commercial properties. Most Indian REITs fall under this category.
• Mortgage REITs (mREITs): Lend money and earn interest on property loans. Rare in India.
• Hybrid REITs: A mix of equity and mortgage REITs, combining rental income and interest earnings.
• Private REITs: Not listed on stock exchanges and unregulated by SEBI, usually accessible only to high-net-worth investors.
• Public Traded REITs: Listed on the National Stock Exchange and regulated by SEBI. Most retail investors prefer these for liquidity.
• Public Non-Traded REITs: Registered with SEBI but not listed on exchanges, limiting liquidity.

Also Read: Which Small-Cap Stocks have Strong Growth Potential?

Types of REITs in India

Investing in REITs is straightforward. Here’s a step-by-step guide:

1. Open a Demat or Trading Account
   Platforms like Zerodha or Upstox make it easy to start.
2. Research the REITs
   Use tools like Tickertape or Moneycontrol to filter REITs based on dividend yield, sector, and market performance.
3. Place Your Buy Order
   You can buy REIT units just like regular stocks. Start small, observe performance, and increase investment gradually.

Tip: Always consider your financial goals and risk appetite before investing in any REIT.

How to Invest in REITs in India

Investing in REITs is straightforward. Here’s a step-by-step guide:

1. Open a Demat or Trading Account
   Platforms like Zerodha or Upstox make it easy to start.
2. Research the REITs
   Use tools like Tickertape or Moneycontrol to filter REITs based on dividend yield, sector, and market performance.
3. Place Your Buy Order
   You can buy REIT units just like regular stocks. Start small, observe performance, and increase investment gradually.

Tip: Always consider your financial goals and risk appetite before investing in any REIT.

Also Read: What are the Best Strategies for Paying Off Debt Quickly?

Why Invest in REITs?

REITs offer several advantages that make them attractive for both new and seasoned investors:

• Diversification: Add real estate to your portfolio without owning physical property.
• Liquidity: Most REITs are listed on stock exchanges, so buying and selling is simple.
• Steady Income: Regular dividends from rental income provide passive income.
• Transparency: SEBI regulations ensure REIT operations are clear and monitored.
• Attractive Dividends: REITs are required to distribute a large portion of their income, often resulting in higher returns.

Real-World Example:

If you invest ₹10,00,000 in Mindspace Business Parks REIT at a dividend yield of 6.63%, you could earn approximately ₹66,300 annually in passive income, without the hassle of managing properties yourself.

Who Should Consider Investing in REITs?

REITs are suitable for:

• Investors seeking diversification beyond stocks and bonds.
• Those looking for passive income through regular dividend payouts.
• Individuals with moderate risk tolerance comfortable with fluctuations in the real estate market.

What Are the Risks?

While REITs are generally safer than owning individual properties, there are risks:

• Taxes: Dividends are fully taxable at the investor’s income tax rate.
• Interest Rate Sensitivity: Rising interest rates can reduce REIT prices.
• Sector-Specific Risks: Retail and hotel REITs can underperform during economic downturns.
• Low Capital Growth: REITs typically reinvest only a fraction of their profits, limiting long-term price appreciation.

Tip: Diversify across different REIT sectors (office, retail, industrial) to reduce sector-specific risks.

Things to Know Before You Invest

• No Tax Benefits: Unlike some mutual funds, REIT dividends are fully taxable.
• Market Volatility: Prices fluctuate based on market conditions.
• Moderate Growth: While dividends are attractive, REITs may not offer explosive capital gains.

REITs are ideal if you want steady income and portfolio diversification, but careful research and risk assessment are essential.

Also Read: How to Create a Budget that Works for You?

Conclusion

REITs are an excellent way to enter the real estate market without owning physical properties. They provide steady income, diversification, and transparency. With options like Mindspace, Embassy, Nexus Select, and Brookfield REITs, investors in India have access to high-yielding opportunities.

The key is research, diversification, and aligning investments with your financial goals. Whether you’re a new investor seeking passive income or a seasoned portfolio manager, REITs can play a vital role in your wealth-building strategy.

Start exploring REITs today and let your money work for you!

FAQs About REITs in India