The Securities and Exchange Board of India (“SEBI”), in exercise of powers conferred under Section 30 read with Section 11 and Section 12 of the Securities and Exchange Board of India Act, 1992, vide Circular No. SEBI/LAD-NRO/GN/2025/258,[1] dated September 01, 2025, has notified the Second Amendment to the SEBI (Real Estate Investment Trusts) Regulations, 2014 (“REIT Regulations”), to enhance disclosure standards, rationalize timelines, and clarify key definitions and reporting obligations.
Key Amendments
1. Definition of Public: The definition of ‘public’ under Regulation 2(1)(ze) of the REIT Regulations has been revised to exclude: (i) the related parties of the REITs; (ii) sponsor, sponsor group, or manager; (iii) any other person as may be specified by SEBI. However, Qualified Institutional Buyers (QIBs), even if otherwise excluded, shall be considered as ‘public’ in an offer.
2. Reporting of Under-Construction Properties (Regulation 10(18) of the REIT Regulations): The timeline for disclosure on development status has been aligned with timelines specified for quarterly financial results.
Further, the valuation reports (under Regulation 21(4) & Regulation (5) of the REIT Regulations) must now be submitted to the trustee simultaneously with their submission to the stock exchange(s).
3. Distribution of Cash Flows by HoldCo: A new proviso has been added under Regulation 18(16)(aa) of the REIT Regulations to state that if the HoldCo’s net distributable cash flow is negative, it may be adjusted against cash flows from SPVs, with disclosure requirements to unitholders as per SEBI’s format.
4. Valuation Reports & Timelines (Regulation 21 of the REIT Regulations):
- Annual Valuation Report (Reg. 21(4) of the REIT Regulations) is to be conducted as on March 31st and is to be submitted with the annual financial results.
- Half-Yearly Valuation (Reg. 21(5) of the REIT Regulations) is to be conducted as on September 30th and submitted along with quarterly financial results for the September quarter.
- Submission Requirements (Reg. 21(6) of the REIT Regulations): the timings have been clarified and the obligation of mandatory communication to unit holders where not explicitly required, has been removed.
[1]https://www.sebi.gov.in/legal/regulations/sep-2025/securities-and-exchange-board-of-india-real-estate-investment-trusts-second-amendment-regulations-2025_96439.html