Reit vs Invit

REITs primarily invest in real estate assets, while InvITs focus on infrastructure projects such as highways, power plants, and warehouses.

3 min

Both REITs and InvITs are investment vehicles, pooling funds from numerous investors and managed by a sponsor or trustee. REITs primarily invest in completed and ongoing real estate projects, while InvITs concentrate on infrastructure ventures such as highways, power plants, roads, warehouses, and various other projects. As the Indian investment market matures and more investors enter in, the number of investment opportunities has broadened significantly. Newer and more sophisticated investment instruments are being explored to meet the diverse needs of the modern investor.

Amongst these vehicles, Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InVITs) have attracted significant attention from the investor community.

REIT and InVIT help you invest in large-scale and high-value projects for capital growth and steady returns.

However, these vehicles come with their complexities. Hence, it is important to know the differences between REIT and InVIT so you can navigate the evolving market in a better way.

What are REITs?

REITs known as Real Estate Investment Trusts are companies that pool money from investors to own and operate income-generating real estate like offices, malls, workspaces, residential, healthcare, etc.

Similar to mutual funds, individuals invest their money in REITs for regular income generation and long-term capital appreciation. This provides an easy way to enter the real estate market and diversify your portfolio. REITs make money either through rental income or from profits derived from selling properties in the portfolio.

REITs are required by law to distribute dividends annually in the form of dividends from 90% of their taxable income - making them an attractive option for investors. They are also required to make 80% of their investments in commercial properties.

Example of REITs

The Embassy Office Parks REIT was launched in 2019 as a joint venture between the Embassy Group and Blackstone; this was India’s first publicly traded REIT. This REIT covers prime commercial office spaces in top IT cities like Bengaluru, Pune, Mumbai, and Noida.

Mindspace Business Parks REIT was established by K Raheja Corp and Blackstone, in 2020. Its portfolio boasts of high-quality office spaces in key economic cities like Mumbai, Hyderabad, Pune, and Chennai. This REIT is known for hosting a diverse array of tenants, including multinational corporations and prominent Indian companies.

By investing in these REITs, individuals can participate in the commercial real estate market of India and earn rental income generated by leasing out office spaces to reputable brands and companies from across the world.

What are InvITs?

InVITs are known as Infrastructure Investment Trusts that own and operate infrastructure assets like highways, roads, power plants, telecom facilities, fiber optic networks, etc.

They too are collective investment schemes similar to REITs but they invest in infrastructure projects.

With InVITs, a retail investor gets the opportunity to further diversify their portfolio by investing in large-scale nation-building projects that were earlier available to only institutional investors.

InVITs distribute almost 90% of their cash flows amongst their investors periodically making them a stable investment option for regular income-seeking individuals.

Example of InVITs

The IndiGrid InVIT invests in operating power transmission grids and assets across India. Through this investment, it provides stable returns and a predictable cash flow to its investors. This is made possible by facilitating long-term agreements with Central and State governments.

Another prominent InVIT is the one offered by IRB whose primary focus is investing in roads and highway projects across India to promote connectivity and transportation. By investing in IRB InvIT, investors can gain exposure to India's infrastructure sector and potentially benefit from stable cash flows generated by toll collections on these road assets.

A lot of investors use REIT and InVIT interchangeably. Although the basic structure and operation remain quite the same, the investing styles for both are significantly different:

Difference between InVIT and REIT

Here are some of the differences between InVIT and REIT:

Aspect REITs InVITs
Asset type These are primarily real estate These are primarily infrastructure assets
Income source Rent, property leases Toll, fees, service charges
Regulation Must distribute 90% of income Must distribute 90% of net cash flows
Liquidity Generally high (if they are publicly traded) Varies (higher in publicly traded forms)
Investment risks Market risks, tenant risks Project-specific risks, regulatory risks


Which is a better option REIT and InvIT?

Whether to opt for a REIT or InVIT depends on

  • Financial goal of the investor
  • Risk appetite
  • Investment horizon

When it comes to returns, both REIT and InvIT distribute about 90% of their income and offer attractive yields.

However, the stability of returns might be generally higher with REITs due to the more predictable nature of rental income, whereas InvITs can offer higher but potentially more volatile returns. Choosing between InVIT and REIT should depend on the investor’s comfort with risk and return, the current economic environment, and the future outlook for real estate and infrastructure sectors.

Ultimately, both InVIT and REIT are useful for diversification and income generation, but they cater to slightly different investment preferences and risk appetites.


Both InVIT and REIT provide unique opportunities and challenges.

Understanding the differences between them is crucial in determining the right investment vehicle based on personal financial goals, risk appetite, and the economic environment. As always, potential investors should conduct thorough due diligence or consult with financial advisors to choose the investment that best suits their portfolio.

However, if you are unsure about investing in either a REIT or InVIT, then you can always come back to investing in mutual funds.

The Bajaj Finserv Mutual Funds Platform makes investing in mutual funds a breeze. You can browse through over 1,000 mutual fund schemes and also compare mutual funds to find the one that aligns with your risk tolerance. You can then make a lumpsum investment amount in that fund or even start a SIP investment.

Calculate your expected investment returns with the help of our investment calculators

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Frequently asked questions

What is the difference between InvIT and REIT?
The primary difference between InVITs and REITs lies in their underlying assets: InVITs invest in infrastructure projects such as roads and power plants, while REITs focus on income-generating real estate properties like malls and offices.
How many REITs and InvITs are there in India?<br><br>
As of now, there are 4 Real Estate Investment Trusts (REITs) and 22 Infrastructure Investment Trusts (InvITs) registered in India. These investment vehicles collectively manage a significant amount of assets, contributing to the growth of India's infrastructure and real estate sectors.
What is the limit of REIT and InvIT?
The initial subscription amount for REITs has been reduced from Rs. 50,000 to a range of Rs. 10,000 – 15,000. Similarly, for InvITs, the initial minimum investment has decreased from Rs. 1,00,000 to a range of INR 10,000 – 15,000.

Can I buy 1 unit of REIT in India?<br><br>
Yes, you can buy individual units of a REIT in India, just as you would purchase shares in a company. These units are traded on major stock exchanges like the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE), allowing investors to buy even a single unit depending on their investment preference and financial capacity.
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Bajaj Finance Limited (“BFL”) is an NBFC offering loans, deposits and third-party wealth management products.

The information contained in this article is for general informational purposes only and does not constitute any financial advice. The content herein has been prepared by BFL on the basis of publicly available information, internal sources and other third-party sources believed to be reliable. However, BFL cannot guarantee the accuracy of such information, assure its completeness, or warrant such information will not be changed. 

This information should not be relied upon as the sole basis for any investment decisions. Hence, User is advised to independently exercise diligence by verifying complete information, including by consulting independent financial experts, if any, and the investor shall be the sole owner of the decision taken, if any, about suitability of the same.