Sebi Proposes Expanding Liquid MF Investment for REITs, InvITs

• Sebi proposes to expand the scope of investment in liquid mutual fund schemes for REITs and InvITs, citing current restrictive eligibility criteria.
• The market regulator aims to enhance ease of doing business for Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs) by offering greater investment flexibility.
• Sebi suggests allowing InvITs to retain investments in Special Purpose Vehicles (SPVs) post-concession expiry for statutory, contractual, or litigation needs, with conditions for exit/reinvestment and enhanced disclosures.
• The proposal also includes aligning investment conditions for private InvITs with public InvITs for greenfield projects, permitting private InvITs to invest up to 10% of asset value in such projects.
• Additionally, Sebi plans to expand the permitted uses of fresh borrowings for InvITs when net borrowings exceed 49% of asset value, and has invited public comments until February 26.