News: Goal-Based Property Investing Grows via REITs, Fractional-28-02-2026

Indian real estate, long treated as a single bulky and illiquid purchase that could absorb a lifetime’s savings, is being reshaped into a goal-based financial strategy through REITs, fractional ownership and digital distribution platforms. Affluent urban professionals in particular are judging property by outcomes: predictable income, long-term capital stability for retirement, or regulated exposure to high-growth infrastructure corridors.

Earlier, an investor either owned a whole unit or nothing, which concentrated risk and kept many middle-class individuals out of commercial and luxury segments. Fractional ownership and tokenisation on platforms such as ALT DRX have changed the entry math, letting capital be spread across a basket of assets. These include Grade-A offices, in a market where gross leasing reached nearly 86.4 million sq. ft across top cities in 2025; industrial warehousing, which has expanded institutionally following the full implementation of the National Logistics Policy; and managed holiday homes in micro-markets like Goa, which records an annual yield of 8-9%.

Digital platforms sort assets by risk-reward outcome. For income seekers, the comparison is with fixed-income returns. The RBI Monetary Policy Committee left the policy repo rate unchanged at 5.25% at its February 6, 2026 meeting. Ten-year G-Sec yields are around 6.6-6.7% and bank fixed deposits generally offer 6% to 6.75%. Data from early 2026 indicate that residential rental yields in metros remain at 2%-3%, while fractional commercial assets are delivering 8%-10%. Tokenised assets in buildings leased to Global Capability Centres (GCCs), which now account for nearly 40% of premium office absorption, can offer relative income stability, especially where leases are long-term and institutional.

For those hedging inflation, tokenisation allows participation "by the square foot", so exposure can be raised gradually as income grows, much like a Systematic Investment Plan (SIP). Underlying asset values and contractual rental escalations, typically 15% every 3 years, help preserve purchasing power when the Consumer Price Index (CPI) fluctuates. For legacy builders, the platform and professional asset managers take over property taxes, tenant management and maintenance. The SM REIT (Small and Medium REIT) framework has gained traction, with a market potential estimated to exceed $60 billion.

SEBI’s SM REIT framework requires schemes to have an asset size between Rs 50 crore and Rs 500 crore and at least 200 unitholders. ALT DRX uses blockchain to keep a permanent ownership record for every token, aimed at reducing the risk of title disputes, and gives investors dashboard access to occupancy rates and audited rental distributions. The reclassification of REITs as equity-related instruments has deepened participation and allows tokenised shares to be traded with more agility than physical property.

Costs and taxes also differ. Traditional purchases carry stamp duty of typically 5-7% plus registration charges, and selling a physical home involves brokerage of 1-2% and legal fees. In the tokenised model, primary acquisition costs are spread across fractional owners and transaction fees are generally lower. Under the current tax code following Budget 2026, physical property owners are taxed at a flat 12.5% LTCG without indexation benefits. Tokenised assets such as SM REITs, classed as equity-related instruments, qualify for the long-term rate after 12 months, against 24 months for physical property, and investors can use the Rs 1.25 lakh annual exemption on gains.

Behaviour is shifting from speculation to return on investment. According to the February 2026 BASIC Home Loan report, Millennials and Gen Z account for 90%-95% of home-loan demand, and 72% of these buyers under 40 prefer end-to-end digital applications. Many keep their primary residence separate from fractional holdings and build real estate equity over time. The average buyer now enters the market at 34, down from 38 six years ago.

The sector is projected to reach $970 billion by 2030, up from the $290 billion estimate of 2025.

This article was produced on behalf of the brand by HT Brand Studio without journalistic or editorial involvement of Hindustan Times, and does not constitute financial advice.