Sebi Chief Declines to Comment on Real Estate Investment Trusts
Real Estate

Sebi Chief Declines to Comment on Real Estate Investment Trusts

Madhabi Puri Buch, the Chief of the capital markets regulator Sebi, chose not to comment on Real Estate Investment Trusts (REITs). She expressed concern that any remarks on the topic might lead to accusations of a conflict of interest. This decision followed questions raised by US short-seller Hindenburg Research regarding a possible conflict involving Buch and Blackstone, a major private equity firm.

Buch?s husband, Dhaval Buch, is a senior advisor at Blackstone, a significant player in the REIT sector. Despite this, both Buchs have denied any allegations of conflict of interest. Additionally, Hindenburg Research claimed that recent amendments to REIT regulations by Sebi, dating back to 2014, were biased in favour of a particular financial conglomerate, an assertion that Sebi has refuted.

At a Confederation of Indian Industry (CII) event, Buch mentioned that any mention of REITs on her part could lead to accusations of conflict of interest. REITs, though relatively new to the Indian market, are popular globally for their attractive returns and capital growth.

REITs consist of a portfolio of commercial real estate assets, most of which are already leased out.

In a related development, the Congress party on Monday accused Buch of conflict of interest and urged Prime Minister Narendra Modi, who heads the appointments committee of the cabinet, to clarify her appointment. At a press conference, Congress alleged that since Buch assumed her role as Sebi chairperson in 2017, she has been receiving a salary from Sebi while also holding an office of profit at ICICI Bank, from which she continues to earn income. Sebi has yet to comment on these allegations.

Last week, Buch had noted a positive response to small and medium REITs (SM REITs), with industry players advocating for regulatory measures for these entities. Recently, Sebi introduced regulations for SM REITs designed to enhance investor interest in fractional ownership of real estate assets.

Madhabi Puri Buch, the Chief of the capital markets regulator Sebi, chose not to comment on Real Estate Investment Trusts (REITs). She expressed concern that any remarks on the topic might lead to accusations of a conflict of interest. This decision followed questions raised by US short-seller Hindenburg Research regarding a possible conflict involving Buch and Blackstone, a major private equity firm. Buch?s husband, Dhaval Buch, is a senior advisor at Blackstone, a significant player in the REIT sector. Despite this, both Buchs have denied any allegations of conflict of interest. Additionally, Hindenburg Research claimed that recent amendments to REIT regulations by Sebi, dating back to 2014, were biased in favour of a particular financial conglomerate, an assertion that Sebi has refuted. At a Confederation of Indian Industry (CII) event, Buch mentioned that any mention of REITs on her part could lead to accusations of conflict of interest. REITs, though relatively new to the Indian market, are popular globally for their attractive returns and capital growth. REITs consist of a portfolio of commercial real estate assets, most of which are already leased out. In a related development, the Congress party on Monday accused Buch of conflict of interest and urged Prime Minister Narendra Modi, who heads the appointments committee of the cabinet, to clarify her appointment. At a press conference, Congress alleged that since Buch assumed her role as Sebi chairperson in 2017, she has been receiving a salary from Sebi while also holding an office of profit at ICICI Bank, from which she continues to earn income. Sebi has yet to comment on these allegations. Last week, Buch had noted a positive response to small and medium REITs (SM REITs), with industry players advocating for regulatory measures for these entities. Recently, Sebi introduced regulations for SM REITs designed to enhance investor interest in fractional ownership of real estate assets.

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