In the Union Budget 2026, the government proposed unlocking value from real estate assets owned by Central Public Sector Enterprises (CPSEs) through the creation of dedicated Real Estate Investment Trusts (REITs).

Announcing the move, Finance Minister Nirmala Sitharaman stated that REITs have proven to be an effective tool for asset monetisation and that the government plans to accelerate the recycling of CPSE real estate assets by establishing focused REIT structures.

REITs are investment vehicles which allow the individuals to invest in high-quality commercial properties without owning them directly such as Grade-A malls, office buildings and warehouses. This provides investors with rental income while allowing them to gain from capital appreciation, along with the flexibility of a listed equity since REITs are traded on stock exchanges.

The government aims to facilitate efficient monetisation of high-value CPSE assets by establishing dedicated REITs.Because of this, the investors can access premium commercial properties easily that were earlier difficult to get a foothold in. The CPSE owned properties continue to attract investors seeking long-term income because of their strategic location, professionally managed and stable tenant profiles.

Under the government National Asset Monetisation Pipeline framework, CPSEs possess vast real estate holdings designated for monetisation. As per the experts, because of the REIT structures, the government can drive its asset monetisation agenda as REITs appeal to institutional investors and attract large funds.

In addition to offering investors predictable rental income and potentially tax-efficient returns, these REIT projects will have government backing, which lowers risk compared to private commercial developments.

5 listed REITs in India:

1. Brookfield India Real Estate Trust

2. Embassy Office Parks REIT

3. Mindspace Business Parks REIT

4. Nexus Select Trust

5. Knowledge Realty Trust

Anshuman Magazine, chairman and CEO for India, South-East Asia, the Middle East and Africa at CBRE, said that incorporating Central Public Sector Enterprises' assets into the REIT framework represents a major shift and is likely to have a layered impact on the asset class, from deepening the market given the scale of these holdings to encouraging higher participation from institutional investors, including mutual funds.

Chintan Patel, Partner in Deal Advisory and Head of Real Estate, Hospitality, Transport, and Logistics at KPMG India, described the plan to consolidate government-owned land and real estate assets via instruments like REITs as a crucial and worthy development. He added that sizable parcels of land and real estate in prime locations across metropolitan cities could be unlocked through this approach.

The Indian REITs Association welcomed the announcement, describing it as a significant step toward shifting CPSE real estate from passive ownership to efficient, market-driven asset management. The association noted that the move would help unlock long-term value from mature public assets while enabling the recycling of capital into new infrastructure development. 

It further emphasised that recognising REITs as a key instrument for asset monetisation strengthens their growing importance in India's infrastructure financing ecosystem. According to the association, dedicated CPSE REITs could accelerate capital recycling, improve balance-sheet efficiency for public sector enterprises, and offer investors better access to high-quality, income-generating assets within a transparent and regulated framework.

Ramesh Nair, Managing Director and CEO of Mindspace Business Parks REIT, stated that creating dedicated REIT platforms for CPSE asset monetisation would help build a strong pipeline of long-term institutional capital for the real estate and infrastructure sectors.

For individual investors, this opens up access to high-quality, income-generating real estate, offering steady dividend income, potential capital appreciation, and the liquidity of being traded on public exchanges. For sustained growth rather than quick profits, REITs are most effective as a consistent, medium-to-long-term element of a balanced investment plan.