SEBI has, by way of two Notifications dated April 1, 2025, and April 28, 2025, amended the SEBI (Infrastructure Investment Trusts) Regulations 2014 (‘InvIT Regulations’), and by way of a Notification dated April 22, 2025, amended the SEBI (Real Estate Investment Trusts) Regulations, 2014 (‘REIT Regulations’). The key amendments include the following:

i.    provision of a three-month timeline for filling independent director vacancies;

ii.   inclusion of a definition for ‘common infrastructure’ vis-à-vis real estate investment trusts (‘REITs’);

iii.  expansion of the responsibilities of the trustee;

iv.   permission of inter-se transfers of locked-in units amongst the sponsor group;

v.    permission of investments in: (a) interest rate derivatives for hedging; (b) unlisted equity shares of companies providing project management services; (c) liquid mutual funds; and (d) equity shares of companies holding common infrastructure vis-à-vis REITs;

vi.   restrictions on REITs from investing in unlisted equity shares of real estate companies; and

vii.  clarification that: (a) cash flows from all Infrastructure Investment Trust (‘InvIT’) assets must be considered for the purposes of calculation of distributions; and (b) if borrowings exceed 49% of the InvIT asset value, a track record of six continuous distributions is required, with a maximum of one distribution per quarter.

Further, key amendments in relation to small and medium REITs include clarifications in relation to the offer documents to be filed by the SM REIT, along with the details for undertaking an initial offer, and provisions permitting SM REITs to invest in interest rate derivatives.