SEBI Alerts Investors As Strata SM REIT Loses Registration
It never launched any scheme or migrated pre-existing fractional real estate entities
The Securities and Exchange Board of India (SEBI) has cautioned investors against dealing with Strata Small and Medium Real Estate Investment Trust (SM REIT), as it has surrendered its registration.
The warning was issued after the market regulator reviewed legal proceedings against the promoter of SEBI-registered SM REIT.
It advised investors to exercise caution while engaging with the entity, which never launched any SM REIT schemes nor migrated any pre-existing fractional real estate entities.
SEBI stated, “Based on the engagement and discussions, Strata SM REIT has surrendered its certificate of registration as an SM REIT and will not hold out or represent itself as a SEBI-regulated intermediary or SM REIT.”
Strata had registered as an SM REIT, a new asset class introduced by SEBI, as a sub-class within the REIT framework for Rs 50-500 crore assets.
Similar to REITs, SM REIT units must be listed on stock exchanges but with a minimum lot size of 1 unit of Rs.10 lakh.
Under the framework, SM REITs are not permitted to invest in under-construction assets or land and must distribute 95 percent earnings as distributions to unit holders.