What is the difference between REIT and InvIT?

REITs (Real Estate Investment Trusts) and InvITs (Infrastructure Investment Trusts) are both SEBI-regulated collective investment vehicles that allow investors to earn returns from real assets through traded units.

Key Differences

• Asset Type: REITs hold commercial real estate (offices, malls, warehouses). InvITs hold infrastructure (roads, power, pipelines).
• Revenue Model: REITs earn rental income from tenants. InvITs earn tariff, toll, or annuity income from government/users.
• Risk Profile: REITs depend on occupancy and rental markets (relatively liquid). InvITs depend on government concessions and regulatory tariff settings (more stable but less flexible).
• Distribution: Both must distribute 90% of distributable cash flows to unit holders.

Similarities

• Both regulated by SEBI under separate regulations.
• Both listed on stock exchanges traded like shares.
• Both require mandatory valuations and independent trustees.
• Both are tax-efficient pass-through vehicles for rental/toll income.
• Both attract foreign portfolio investors and institutional capital.

REITs and InvITs serve different asset classes but share a common DNA pooled investment, regulated distributions, and stock exchange listing. Together, they form the cornerstone of India's growing market in real asset investment vehicles accessible to all investors.