18 debt issuances, ₹1 trillion+, the fastest half-year sprint yet

Reits, Invits tapped debt every 10 days in record run

Investment vehicles that manage rental properties and infrastructure assets have been increasing their debt levels. There has been a debt issue roughly every 10 days from either a real estate investment trust (Reit) or an infrastructure investment trust (Invit) in the first half of 2025, according to an analysis of issuer data from Prime Database. 

The cumulative amount of debt raised in the first six months of 2025 is higher than in any similar period since data became available. Total debt issuance since inception has now crossed ₹1 trillion, reaching ₹1.02 trillion as of June-end. 

A Reit manages properties such as office buildings through a pooled investment vehicle, somewhat similar to a mutual fund. Investors can buy and sell units in the trust, which manages the properties for a fee and distributes the rental income as dividends. 

Invits operate broadly in a similar fashion, except the underlying asset is typically a cash-generating one, such as a toll highway. 

Those that raised debt in June include Vertis Infrastructure Trust and Embassy Office Parks Reit. Others active during the year include Cube Highways Trust, Nexus Select Trust, IndiGrid Infrastructure Trust, and Mindspace Business Parks Reit. Together, they raised ₹21,119 crore in the first six months of 2025 — the highest for this period since 2018. 

There has also been a broader increase in debt fundraising amid falling interest rates in the corporate bond market, which saw record issuances in 2024–25, said Pranav Haldea, managing director at Prime Database. 

“Rate transmission has been much faster in the bond market than in the banking segment... I would expect fundraising through bonds to further increase with rates going down,” he said. 

Regulatory steps to ease the use of investment trusts — such as the proposal to classify Reits and Invits as equity instruments — could lead to more capital inflows, Haldea added.

 

Several Reits are funding their expansion through debt, given that they still have headroom before hitting the regulatory borrowing limit of 49 per cent of assets, according to a May 2025 India Equity Research note from Nuvama Institutional Equities by Parvez Qazi and Vasudev Ganatra.

 

“All Reits are currently in portfolio expansion mode to exploit the improvement in demand. Given that loan-to-value (LTV) ratios for all Reits remain far below the regulatory cap of 49 per cent, acquisitions and expansions are being funded by debt. While net debt is gradually rising, the increase in gross asset value is keeping LTV in check,” the report said.

 

All office Reits have a cost of borrowing under 8.3 per cent, the report observed. Embassy Reit announced on June 30 that it had raised ₹1,550 crore in debt, including a portion (₹750 crore) at 6.97 per cent.

 

Meanwhile, equity fundraising has declined from earlier peaks. This refers to listed investment trusts, while the debt figures cover both listed and unlisted players. Listed Reits and Invits raised ₹11,588 crore in equity capital in the first six months of 2025, down from ₹15,597 crore in 2024 and ₹12,819 crore in 2021.