Fractional real estate emerges as wealth-building tool for young professionals & NRIs: Whiteland Corporation

High-value commercial real estate, once out of reach for most retail investors, is now becoming an accessible asset class through fractional ownership.

In an interview with ETMarkets, Sudeep Bhatt, Director Strategy, Whiteland Corporation, explains how SEBI’s SM REIT framework and digital platforms are enabling young professionals and NRIs to co-own premium assets like office spaces, warehouses, and luxury hotels.

With the dual benefits of steady rental income and long-term capital appreciation—minus the hassle of direct property management—Bhatt believes fractional real estate is fast emerging as a smart wealth-building avenue for the new generation of investors. Edited Excerpts –

Q) How is fractional ownership changing the way retail investors access premium commercial real estate in India?

A) Fractional ownership is a game-changer for retail investors in India. Premium assets like office spaces and warehouses, once unaffordable due to high entry costs, are now accessible.

Thanks to SEBI’s SM REIT framework, young professionals and NRIs can co-own high-value assets and benefit from both rental income and capital appreciation without the burden of managing properties.

Digital platforms, supported by clear regulations, make the process transparent and approachable, allowing investors to diversify portfolios and build wealth through real estate.

Q) With interest rates stabilising and inflation cooling, is fractional real estate becoming a more attractive alternative to fixed income?

A) Many investors are rethinking traditional strategies. Fixed income options, while relatively safe, are no longer delivering strong returns.

Fractional real estate offers an attractive alternative by combining steady rental income with the potential for property appreciation—without requiring large capital.

In the current environment, balancing fixed income with fractional real estate can provide both stability and growth opportunities.

Q) Can investors put money into properties outside India via digital real estate platforms?

A) Yes, investing abroad is now easier than ever through digital platforms that use fractional ownership models. Indian investors can purchase a share of premium international properties at a much lower entry cost compared to traditional methods.

These investments are permitted under the RBI’s Liberalised Remittance Scheme (LRS), subject to yearly limits. Platforms typically handle property management and paperwork, offering a seamless experience for investors.

Q) How do rental yields in fractional real estate compare with direct ownership in the current market?

A) Rental yields in fractional real estate are often higher than those from direct ownership.

Platforms usually focus on high-value commercial assets like Grade-A offices and luxury hotels, where long-term leases with reputed tenants ensure attractive and stable returns.

Professional management also removes the hassle of tenant search and maintenance, offering investors a passive income stream.

Q) What risks should retail investors watch out for in fractional real estate, especially in a cooling inflation environment?

A) While appealing, fractional real estate has its risks. Property values may stagnate or decline, affecting overall returns. Rental yields could shrink if demand softens.

Liquidity is another challenge—selling your share is not always quick or easy. Investors also rely on platform governance and transparency, which makes due diligence critical.

Like all investments, fractional real estate should be approached with careful risk assessment.

Q) Could fractional ownership expand meaningfully into residential and holiday homes in the next 3–5 years?

A) Fractional ownership could transform residential and holiday homes in India over the next 3 - 5 years, making dream homes accessible to more people.

With SEBI’s SM REIT framework ensuring transparency, tech-savvy millennials and middle-class investors are drawn to platforms offering shared ownership, rental income, and capital gains without the hassle of maintenance.

As trust in digital real estate platforms grows, families could enjoy luxury getaways and steady returns, turning aspirational homeownership into a reality for everyday Indians.

(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)