Mutual funds warm up to REITs and InvITs, but exposure remains low

Investments soar 27x in 5 yrs to nearly ₹20K cr; still at 0.3% of MF assets

- ABHISHEK KUMAR

Even as mutual funds (MFs) increasingly invest in real estate investment trusts (REITs) and infrastructure investment trusts (InvITs), their total exposure remains fractional at just 0.3 per cent of the industry's assets under management (AUM).

Although MFs have been permitted to allocate up to 10 per cent of their AUM to these assets since early 2017, significant investment growth has been seen only recently.

From ₹734 crore in March 2020, investments have risen to nearly ₹20,000 crore in March 2025, according to PRIME Database. Still, this accounts for just 0.3 per cent of the MF industry's ₹65.7 trillion AUM.

Experts note that despite a growing number of schemes authorised to invest in REITs and InvITs, investments remain limited due to a strong equity market, liquidity issues, and constrained evaluation capabilities.