Commercial real estate investment platform Strata, backed by Kotak Investment Advisors and Gruhas Proptech, has filed an application with the capital markets regulator to launch a small and medium real estate investment trust (SM REIT), making it one of the first few players likely to establish such a platform.
The move comes only months after the Securities and Exchange Board of India (SEBI) notified the framework for SM REITs to enable investment in smaller rent-yielding properties in India in March this year, after having floated a consultation paper in May 2023.
This application will enable the fractional ownership platform to transfer its eligible assets to the SM REIT, once the licence is approved, as the platform is targeting to grow its total assets under management (AUM) to about Rs 2,000 crore by the end of this fiscal year.
Sudarshan Lodha, the co-founder and chief executive of Strata, said that the company is aligned with SEBI’s vision to streamline fractional ownership, elevating it to mainstream investment status. “We are thrilled by the recent growth of this sector, and we believe that this regulatory push will enhance credibility and investor confidence,” Lodha said.
Among others, the National Real Estate Developers Association (NAREDCO) President G Hari Babu said last month that the first such SM REIT is expected to be listed on the exchanges within the next six months, according to a report by Business Standard.
Strata is backed by Kotak Investment, Gruhas Proptech, Sabre Investments, Elevation Capital, Mayfield, and PropStack. The commercial real estate ownership tech-enabled platform currently has assets under management of Rs 1,800 crore, with about 1 lakh members, and 3,000 investors. Its total portfolio spans 4 million square feet and is located in Mumbai, Bangalore, Pune, Hosur, Hyderabad, and Chennai, among other cities.