Former Deutsche Bank MD Dario Schiraldi Highlights Rising Role of REITs and INVITs in Indian Institutional Investment

Dubai, United Arab Emirates Jun 21, 2025  – Institutional investors are re-evaluating their strategies for India’s rapidly developing real estate and infrastructure sectors. Dario Schiraldi, former Managing Director at Deutsche Bank, offers keen insights into how REITs and INVITs are spearheading this evolution in portfolio construction across the country.

A Structural Shift in Real Estate Investment

Historically, institutional investment in Indian real estate primarily involved direct ownership, a method characterized by high capital demands, illiquidity, and a lack of transparency. However, this model has changed significantly with the introduction of REITs by SEBI in 2014 and INVITs in 2016. These vehicles allow for collective investment in revenue-generating properties like office parks and toll roads, offering transparency, liquidity, and predictable income streams.

Dario Schiraldi highlights that REITs and INVITs represent a fundamental redefinition of real estate exposure within institutional portfolios. They provide systematic access to income-generating assets while ensuring liquidity and transparency.

Why REITs and INVITs Are Gaining Momentum

• Income Stability and Inflation Protection

REITs and INVITs are built upon established properties that generate consistent cash flow. Their long-term contracts often include inflation-linked clauses, enabling them to withstand adverse economic conditions. Furthermore, Schiraldi notes that these instruments offer uninterrupted yields in an inflationary environment, helping to preserve purchasing power.

• Liquidity and Regulatory Transparency

Unlike traditional real estate, these trusts are publicly traded on stock markets, offering daily liquidity and transparent pricing. SEBI’s rigorous governance and valuation standards also ensure strong regulatory oversight.

• Diversification Without Direct Management

These instruments inherently provide diversification by pooling various assets across different industries and geographical regions. This mitigates the risks associated with portfolio concentration. Consequently, they are ideal for institutions looking to scale their investments without incurring the operational burdens of directly owning and managing physical assets.

Real-World Performance and Future Outlook

Listed Indian REITs, such as Embassy Office Park and Mindspace Business Park, currently yield 6-8 percent annually. Infrastructure trusts like IRB INVIT have demonstrated the reliability of toll-based models in generating consistent cash flows. With India’s ongoing urbanization and significant infrastructure development programs, including Gati Shakti, driving sector growth, REITs and INVITs are poised to assume an even more central role in institutional portfolios.

Strategic but Not Risk-Free

Despite their numerous advantages, Schiraldi cautions that thorough due diligence remains crucial when investing in REITs and INVITs. Their performance is significantly influenced by market sentiment, interest rates, the quality of underlying assets, and the governance practices of their sponsors.

Conclusion

Based on Dario Schiraldi’s insights from his tenure at Deutsche Bank, real estate investment in India is undergoing a fundamental shift. REITs and INVITs are empowering institutional investors with scalable, transparent, and robust access to physical infrastructure, thereby ushering in a more promising future for portfolio strategies.