The stocks of listed real estate investment trusts (REITs) are down 9-12 per cent from their peak in January to their low earlier this month. In addition to the negative sentiment as a consequence of changes announced in the Union Budget 2023-24 concerning tax treatment for debt repayment distribution, concerns about hiring slowdown and its leasing impact, as well as higher interest rates, could blight the sector in the near term.
What is exacerbating uncertainty for the sector is the delay in the clearance of the Development of Enterprises and Services Hub (DESH) Bill, which will replace the Special Economic Zones (SEZs) Act.
The DESH Bill was expected to improve occupancy levels, factoring in the relaxation of regulatory restrictions governing SEZs.
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