Motilal Oswal Asset Management Company has filed draft papers for two new passive investment products based on the Nifty REITs & Realty Index. The proposed products are the Motilal Oswal Nifty REITs & Realty Index Fund and the Motilal Oswal Nifty REITs & Realty ETF.
The move comes at a time when more asset management companies are looking at products that give investors simple access to specific parts of the Indian market. Real estate and Real Estate Investment Trusts, or REITs, have also gained more attention as investors look for assets beyond traditional stocks and bonds.
The two Motilal Oswal products will track the Nifty REITs & Realty Total Return Index. This will allow investors to gain exposure to a group of listed REITs and realty companies through a single product rather than select each security on their own.
The filings were submitted to the Securities and Exchange Board of India, or SEBI, on September 1, 2026. At this stage, these are draft filings. The products are not yet available for investment.
What Is the Nifty REITs & Realty Index?
The Nifty REITs & Realty Total Return Index is designed to provide exposure to the listed REIT and realty space. The index can have up to 15 securities.
A key feature of the index is its REIT exposure. REITs have a minimum weight of 60% in the index. This means the index has a strong focus on REITs, while also giving investors exposure to real estate companies.
The weight of an individual security can go up to 15%. This limit helps prevent one company or REIT from taking too much space in the index.
The structure gives the index a mix of two related areas. One part comes from REITs, which own or operate income-producing real estate assets. The other part comes from listed realty companies, which are more closely linked to property development and the broader real estate market.
For investors, this can offer a different way to take part in the property sector without the need to buy physical property.
Two Products With the Same Index
Motilal Oswal has proposed both an index mutual fund and an ETF. Although both products will follow the same index, they will work in different ways.
The Motilal Oswal Nifty REITs & Realty Index Fund will be an open-ended index fund. It will seek to follow the performance of the Nifty REITs & Realty Total Return Index.
The proposed minimum investment in the index fund is ₹500. This makes the product accessible to investors who want to start with a relatively small amount.
The second product is the Motilal Oswal Nifty REITs & Realty ETF. An ETF trades on a stock exchange in a manner similar to a listed share. Investors can buy and sell units during market hours through their trading account.
The proposed minimum investment for the ETF is one unit.
Both products aim to provide returns that are close to the index, before costs and other factors. Since these are passive products, the fund manager does not have to select stocks based on personal views about which company may perform better.
Why REITs Matter to Investors
REITs have created a new route for investors who want exposure to real estate. Instead of buying a property, an investor can buy units of a listed REIT.
A REIT owns or manages income-producing properties. These assets can include office buildings, shopping centres, warehouses and other commercial properties. Income from these assets can form an important part of the return for REIT investors.
The listed REIT market has also made real estate more accessible to smaller investors. A person does not need the large amount of money that is usually required to buy a house or commercial property.
However, REITs are still market-linked products. Their unit prices can rise or fall based on interest rates, property demand, rental income, economic conditions and investor sentiment.
The new Motilal Oswal products will give investors access to this segment through an index-based structure.
More Products Enter the Pipeline
Motilal Oswal is not the only fund house that has shown interest in this area. The latest filings come as several other passive products have also entered the pipeline.
HDFC had filed the BSE REITs and Commercial Real Estate Index Fund on August 21, 2026. This product also points to the growing interest in listed real estate and REIT-focused investment products.
Other recent passive product proposals include Kotak’s Nifty Infrastructure Index Fund and Aditya Birla Sun Life’s BSE Total Market Index Fund and ETF.
This wider set of filings shows that asset managers are looking beyond the most common broad-market index products. Investors already have access to funds based on large indices such as the Nifty 50. The new proposals add more options for people who want exposure to specific sectors or themes.
The rise of such products can also make it easier for investors to build a portfolio based on a particular market view.
A Simple Route to Real Estate Exposure
One of the main attractions of an index product is simplicity. An investor does not have to study every listed realty company or REIT before making a decision.
Instead, the fund follows a set index with defined rules. The Nifty REITs & Realty Index has up to 15 securities and keeps at least 60% of its weight in REITs. Individual securities can have a maximum weight of 15%.
This structure can reduce the risk that comes from a single company dominating the portfolio. At the same time, investors remain exposed to the overall performance of the real estate and REIT segment.
For new investors, this can be easier to understand than direct property investment. There is no need to arrange a property loan, deal with tenants or manage a physical asset.
What Investors Should Watch
The proposed products could attract interest from investors who want a focused allocation to real estate. But sector-focused funds can also carry more risk than broad-market funds.
The performance of these products will depend on the securities that form the index. Property prices, rental demand, interest rates, economic growth and the financial health of real estate companies can all affect returns.
REITs also have their own risks. Higher interest rates, for example, can affect borrowing costs and may reduce the appeal of income-focused assets. Changes in occupancy, rental rates and property values can also affect REIT performance.
Investors should therefore view these products as a focused part of a portfolio rather than assume they can replace a diversified equity fund.
A New Chapter for Passive Investing
The Motilal Oswal filings highlight how India’s passive fund market continues to expand into new areas. The proposed Nifty REITs & Realty Index Fund and ETF will combine exposure to REITs and realty companies under one index-based structure.
The index has up to 15 securities, with REITs at a minimum 60% weight and a 15% maximum weight for an individual security. The proposed index fund has a minimum investment of ₹500, while the ETF requires a minimum of one unit.
The timing is also notable because other fund houses have proposed products linked to REITs, commercial real estate, infrastructure and the wider stock market.
For investors, the biggest change is choice. Instead of relying only on direct stocks or physical property, they may soon have another simple route to participate in India’s real estate market.
Still, the Motilal Oswal products are at the draft filing stage. Final approval, launch details, costs and other terms will matter before investors decide whether these products deserve a place in their portfolios.
