For investors looking to add real estate exposure, buying another apartment isn’t the only option. REITs offer a way to invest in income-generating commercial property without owning or managing a physical asset. However, investors should look beyond headline yields and assess total returns, balance-sheet strength, occupancy, growth prospects and interest-rate risks, says Ramesh Nair, MD and CEO of Mindspace REIT.
Speaking at the ET Alpha Wealth Summit 2.0, Nair said investors should view REITs as part of their overall asset allocation along with equities, bonds, gold and mutual funds, rather than as a substitute for owning a home or investing in residential property. He also cautioned against extrapolating recent strong returns, describing REITs as a moderate-risk, moderate-return investment.
