General

Fractional real estate investment is an innovative way to invest in real estate assets. It refers to the legal sharing of property among multiple owners. The property title is divided in a manner that each investor owns a fraction of the real estate asset. The investors earn monthly rentals and benefit from appreciation in the value of the asset.

Hissedari.com is a tech enabled fractional real estate investment platform where we choose high potential assets of real estate like Pre-Leased Commercial, Warehouse, Holiday Home, Co-Living and Co-Working space that command higher rentals and have the potential for substantial capital appreciation. Please visit “How it works” to know more. Hissedari.com, a venture by “Propeneur Mantra LLP”, a Subsidiary of “Property Mantra Proptech LLP”. It is a tech enabled digital platform that provides easy access, transparency, and liquidity to curated selection of pre-leased real estate assets. We have 15 years of industry expertise and proprietary technological solutions. Hissedari.com will enable investors to co-own by allowing fractional ownership to your asset portfolio.

Fractional ownership is a model of Investment in which several unrelated parties can share in the risk, rewards and ownership of a high-value tangible asset (like real estate). In simple terms, by investing INR 20,00,000 in a INR 20,00,00,000 asset you will get the ownership of 1% of the asset. Fractional ownership, unlike full ownership, allows customers to diversify their portfolio, access high-worth investment avenues, reduce capital constraints and hedge risks.
Some of the benefits of investing via the Hissedari.com platform include:

Simple and digitally-enabled investment process for investors

Low minimum investment (starting at INR 5Lakhs*) enabling access to institutional quality real estate opportunities.

Hassle-free real estate ownership with Hissedari.com in managing operations, distributing rental yield and facilitating exit.

Enhanced Liquidity Solutions via proprietary Hissedari.com.

Any Indian citizen, NRI, Company (Pvt. Ltd/ LLP/ Proprietorship), Hindu Undivided Family (HUF), Trust and Co-operative society can invest with Hissedari.com subject to valid KYC and regulatory guidelines.

Hissedari.com offers users an opportunity to participate in complete and rent generating in Grade A real estate assets such as Pre-Leased Commercial, Warehouse, Office Spaces, Data Centers, Industrial Spaces, Holiday Home, Co-Living and Co-Working space etc. with up to 8-10% yields and 12-15% target IRRs.

Property listing is the most important process in Hissedari.com. Any asset chosen by our team is shortlisted on various metrics, big data analytics, predictive algorithms, and stringent financial evaluation like location advantage, legal title, micro and macro market review, rental yields, lease duration, quality of asset, technical due diligence, scope of capital appreciation and earning potential. We rely on the extensive experience of our team which comes with more than $1 billion of real estate investment experience. Only 1% of the properties analyzed are listed on our platform.

You can sign-up and schedule a call with our dedicated manager who will help in answering all your specific questions/ queries. Click here to schedule a call. You can also send an email to info@hissedari.com

Hissedari.com founders and team come from core real estate investing backgrounds having invested $1 billion in Indian real estate and believe that rent yielding real estate, if researched thoroughly and conservatively, offer the best after-tax returns.

Pre-Investment

Through Hissedari.com, you would be investing in a real estate asset by means of an investment vehicle known as an SPV (Special Purpose Vehicle), in which all investors would be given a shareholding proportionate to the amount of their investment.

The first thing you will need is a Hissedari.com account which is KYC verified.

Once verified, a virtual account will be created and you can now invest in any open opportunity listed on the platform.

To do so, all you need to do is just a click on the ‘Invest Now’ button and confirm your investment details.

If you decide to move forward and block your investment, you will need to e-sign a binding Expression of Interest (EOI) and transfer the initial 10% token advance to a virtual account, which you will find on your dashboard.

You will receive all necessary property and SPV-related documents for your perusal and scrutiny.

Once 100% commitment is received from interested investors, the opportunity is considered to be fully funded.

You will then be required to transfer the remaining amount into your virtual account.

Your investment amount will then be routed through an escrow mechanism to the share subscription accounts and ultimately, to the current account of the SPV.

You will be allocated equity shares and compulsorily convertible debentures (CCDs) in the Private Limited Company.

The SPV will then proceed to purchase the asset.

Your investment is completed as soon as the opportunity is fully funded and private placement of your investment is done in the SPV. Hissedari.com generally has a time frame of 60 days to ensure that the property receives complete funding.

Investing with Hissedari.com implies that you will be a fractional owner of the asset you invest in. The other investors in the property can be either individuals or corporations.

Product & Procedure

You can register on the platform by providing basic details about yourself through the “Sign-up” button.

Our KYC process is completely digital, all you need is original scanned copy of the following documents –

Once you are registered on the platform, you will receive notifications on new listings and other updates that may be of interest to you. Alternatively, you can drop an enquiry with us and we will update you as soon as we have a new opportunity. “Click here” to drop an enquiry.

Yes, you can visit any asset chosen for investment. As pre-leaded assets premises are operational facilities for the tenants and hence constant visits can become a hindrance for the tenant. However, we are working on a tech solution to enable virtual tours of the premises.

No, there is no requirement to be physically present. Hissedari.com is a technology-driven platform, and your entire investment process is end-to-end digital in nature. You can make your investment from the comfort of your own home. All required documentation will be signed digitally through a reputed digital signature provider.

No, the assets are usually housed in a Special Purpose Vehicle (“SPV”) company which can authorize a person to complete the registration on behalf of the SPV.

Investment

Investments are made through bank transfers, NEFT or RTGS.

The minimum investment is Rs. 5 lac. However, the minimum investment amount differs from property to property. Kindly refer to the respective property id to find the minimum investment amount.

Yes, there is an initial lock-in for all investors from the time the property is registered. You are free to sell your holdings thereafter. However, if you have an investment horizon of fewer years, it is recommended to not invest with in real estate in general.

Hissedari.com DOES NOT guarantee any returns. While rental yields on most opportunities listed on the platform are known in advance, a risk that the yield will not be payable will always remain due to underlying real estate asset and leasing risk.

Our presentations, webinars and discussions only indicate projected returns. We advise potential investors to be cautious of any scheme which provides guaranteed returns.

Every investment opportunity will have its own unique exit strategy and holding period. However, individual early exits have also been made possible for investors through our other two liquidation options i.e. private sale or sale through the Resale market. Investors can choose to make individual exits post their respective lock-in periods.

You can view the performance of your investment through our online dashboard. Note that the Net Asset Value (NAV) of the property will be updated on a half-yearly basis.

Your investments are yours and are absolutely secure regardless of what happens to Hissedari.com Here’s how-

Your investment is in the form of equity shares and compulsorily convertible debentures in a Private Limited Company, incorporated for the sole purpose of acquiring and owning the asset by virtue of holding equity shares in the SPV, you are true owner of the asset.

The SPV is bound to comply with statutory requirements such as holding general meetings, filing returns, etc., that are undertaken by third-party consultants. Due to this structure, the ultimate decision-making power lies with the investors alone.

As the asset is registered as a separate entity and Hissedari.com simply acts as an asset manager, Hissedari.com could be replaced by another asset management firm that would continue to provide the same services as Hissedari.com. Thus, even if Hissedari.com is not functional, your ownership and control of the asset remain secure and even the records are stored in appropriate public databases such as Ministry of Corporate Affairs website.

No, you cannot get a loan on these investments. However, Hissedari.com is actively working on finding leverage solutions for its clients.

Finance

Other than an initial acquisition fee which varies depending on the opportunity, we charge the following -

A) 1% annual management fee that is charged on the monthly payout.

B) During exit, a performance fee of 20% on the gains above a hurdle rate of 10% IRR will be charged.

For example, let us take a scenario where a sale of property happens after 5 years. On a property value of 25,00,000 lakh, gains calculated at 10% IRR after 5 years would be ~Rs. 13,27,500.(Sale Value + Rentals - Cost of Investment)

If the investor realizes gains on the property of Rs. 14, 00,000 (Sale Value + Rentals - Cost of Investment) we would charge 20% on Rs. 72,500 (14,00,000-13,27,500) i.e. Rs 14,500. If an investor earns below 10% IRR, no performance fee is charged.

No, there will be no asset management fee charged to investors for as long as the property is not tenanted.

Typically, the distributions are made on a monthly, quarterly basis or on the same periodicity as is paid by the tenant.

Hissedari.com will take care of all aspects related to the asset including property tax filing, tenancy management and payments, insurance, and day-to-day management on behalf of the investors.

There is a separate Property Management team that takes care of all property management functions.

The return on your investment is in the form of interest on debentures and is paid monthly. The interest/coupon rate of the debentures you hold is a function of the rents generated and interest earned on the security deposit. The return is transferred to your bank account on or before the 10th working day of every month subject to the receipt of rents from the tenant.

Once an initial investment or token advance is paid, a termination fee shall apply for any withdrawals. The fee will be as per the terms mentioned in the Expression of Interest.

If there is no tenant the CAM and property-tax charges will be borne by the SPV as per actual. This amount will first be taken from the contingency reserve subject to the availability of funds.

If re-leasing is directly through a client there will be no brokerage. If the client comes through a broker, the brokerage has to be paid out of company funds or from future rentals.

Any unforeseen expenses that arise in the property are met using the contingency reserve. If the reserves are not used, they are refunded back to the investors at the time of sale of the asset.

Tax Related

Your tax documents as applicable will be available on your investor dashboard.

All tax documents including the Quarterly TDS certificates will be made available on your dashboard. For any other tax documentation, please reach out to your dedicated Hissedari.com investment manager.

Distributions: Distributions are taxable directly in the hands of the user as per his/her tax bracket. The indicative withholding tax under the current income tax regime has been reproduced below:
Residential status as per Income Tax Act, 1961 Withholding Tax rate (TDS)
Resident 10%
*Non-resident Individual (“NRI”) 30% (plus applicable surcharge and cess)*

*NRIs can explore benefits under Double Taxation Avoidance Agreement (“DTAA”) entered with the respective country, subject to availability of Tax residency Certificate (“TRC”).

The typical deductions are tax deduction at source, property management fee and property tax or any other charges/taxes levied by the government.

Yes, the TDS on your distributions is paid and deposited against your PAN number and can be claimed back at the end of the year.

Yes. The SPV deducts a 10% TDS before remitting returns to Resident Indians and 20.8% for NRI Investors.

Resident Indians can submit Form 15G/15H and NRI’s* can submit TRC for reduced TDS

NRIs can explore benefits under the Double Taxation Avoidance Agreement (“DTAA”) entered with the respective country, subject to the availability of a Tax Residency Certificate (“TRC”).

For Indian residents, you will be paying taxes on rental payouts and on capital appreciation.

Rents: Rents received from the property are distributed as interest on debentures. It is taxable in the hands of the investors under “Income from Other Sources” at the applicable tax slab.

Capital Appreciation: Capital appreciation is subject to capital gain tax at applicable rates. The applicable tax rate would depend on the period for which the shares and debentures were held (short-term vs long-term).

Short-term Capital Gain will be applicable if the shares and debentures are sold before 24 and 36 months respectively this will be taxed at the rate applicable to the investor.

Long-term capital Gain will be applicable if the Shares & Debentures are held for more than 24 and 36 months respectively. It will be taxed at 20%, irrespective of the quantum of gains.

The benefit of indexation may be explored in the case of long-term capital gains. (Holding Period 2 years for shares and 3 years for Debentures).

Monthly distributions to investors are made in the form of 'interest' and are accordingly taxable in the hands of the investor as per his/her income tax slab rate. The indicative 'tax deducted at source' (TDS) under the current income tax regime, on such distributions, has been reproduced below:

1) Residents - 10% (plus applicable surcharge and cess).

2) NRI - 30% (plus applicable surcharge and cess)

TDS Certificate will be issued every quarter by MYRE on behalf of the SPV. The same will reflect in the Form 26AS of the investor.

NRI's can explore benefits under the Double Taxation Avoidance Agreement (“DTAA”) entered with the respective country, subject to availability of Tax residency Certificate (“TRC”

Capital gains tax is attracted at the time of exit from the SPV on sale of securities of SPV (Private Limited Co). Depending on the tenure of investment it will either be classified as long-term capital gain (LTCG) or Short term Capital Gain (STCG). The benefit of indexation is available in the case of long-term capital gains for resident investors. Taxation for Resident Investor:

Short term capital gains (STCG) - Taxed as per your tax slab

Long term capital gains (LTCG) - 20% with indexation benefit

Taxation for NRI Investor:

Short term capital gains (STCG) - Taxed as per your tax slab (30% TDS)

Long term capital gains (LTCG) - 10% (No indexation benefit)

Capital appreciation is subject to capital gain tax at applicable rate. The applicable tax rate would depend on the period for which the asset was held (short term vs long term). The benefit of indexation may be explored in case of long term capital gains (holding period [●] years).

No, the structure is effectively pass-through. Only a single level of taxation, in the hands of the investor, will be applicable on the monthly distributions.

Yes, the tenant pays GST on the rentals as applicable over and above the rent.

The rentals received by the SPV are subject to 10% TDS and are treated as business income in the books of the SPV. The rental income after deduction of expenses is passed on to the investor as interest on CCD. The interest distributed to investors is only taxable income of the investor and does not attract any taxation in the SPV.

NRI

Yes, you can transfer the transaction amount from your NRE or NRO account subject to certain conditions.

Transfer of foreign currency by NRIs is regulated by extant RBI and FEMA guidelines. Please speak to your financial adviser for a more detailed understanding of your specific requirements.

No, since NRE is a freely reportable account, INR deposits cannot be made into an NRE account. Your distributions will be credited to your NRO account from where you can transfer it to your NRE account. Please speak to your banker for a more detailed understanding of your specific requirements.

Under Indian income-tax law, an NRI is required to pay tax on any Indian sourced or received income. A basic exemption limit is provided under the Indian tax law. If the income in India does not exceed the basic exemption limit, the NRI will not have to pay tax in India. If the income in India exceeds basic exemption limit, the NRI will have to pay taxes in India as per the applicable slab rates.

Rent Income: It will be distributed as interest on debentures. It will be taxed at the applicable tax rate or the rates of the tax treaty, whichever is beneficial to the investor.

Appreciation: Capital appreciation is subject to capital gain tax at applicable rates. The applicable tax rate would depend on the period for which the asset was held (short-term vs long-term).

Short Term Capital Gain will be applicable if the Shares & Debentures are sold before 24 months and 36 months respectively. It will be taxable as short-term capital gains at applicable tax rates for the respective NRI(s).

Long-term capital Gain will be applicable if the Shares & Debentures are held for more than 24 months and 36 months respectively. It will be taxed at 10%, irrespective of the quantum of gains.

*NRIs can explore benefits under Double Taxation Avoidance Agreement (“DTAA”) entered with the respective country, subject to availability of Tax residency Certificate (“TRC”).

Please contact your dedicated investment manager for further details.

Even if an NRI’s income in India does not exceed the basic exemption limit, taxes may be withheld as TDS (Tax Deducted at Source) as applicable. In such case, a NRI can claim a refund of taxes withheld by filing a tax return in India.

A TRC is a Tax Residency Certificate provided by the country where you are currently residing. India has a Double Tax Avoidance Agreement (DTAA) with almost all major countries that reduce TDS to lower thresholds of 10-15% (depending on the provisions of the DTAA). However, the benefit of the reduced tax rate is only available to users who are able to produce a TRC. Please speak to your tax advisor on how you can procure a TRC for your country of residence.

Risk

Fractional ownership is a lucrative investment option due to its low risk and high return profile. The risk is relatively very low compared to most investment options at these expected returns. Hissedari.com uses technology to create transparency of information and ease of access, to mitigate these risks as much as possible.

A listing on the platform carries inherent risks of loss of capital as with any real estate investment. We list only the best properties after stringent due diligence and evaluation process. Only 1% of the total properties analyzed are listed on the platform Please consult your financial advisor before making any decision.

This is a relatively low risk investment model. Risks associated could include changes in property prices or renegotiations of rentals. We ensure that all the assets we pick for you are Grade A buildings with top-tier tenants, clean contracts and long commitment periods, to ensure consistent monthly returns for our investors, and choose assets with we believe have a strong potential to appreciate in value over the years. Various risks associated with fractional investments such as liquidity, tenant, and market risks have been mitigated as much as possible with our strong due diligence and management processes.

In the unlikely event that a property on our platform doesn't complete its funding target due to any risk arising from the due diligence, any funds that have been received by investors will be reimbursed to their registered bank account. Please refer the T&C outlined in the EOI document (Expression of Interest) for further detail.

Real estate investments are illiquid and there can be significant delays in getting liquidity in the given ticket size and lack of buyers. Investors can exit the asset anytime by selling it directly to another investor or by listing it on the platform. In the latter case, you would only be able to sell when there is a willing buyer on the platform. Please evaluate your decision carefully and consult your financial advisor if liquidity is important to you.

Legal

A Special Purpose Vehicle (‘SPV’) is an entity/ company incorporated under the law, being a Partnership firm, LLP, a Private Limited Company, etc., for a specific lawful purpose. Such vehicles are commonly used to invest/acquire assets such as real estate, companies, etc.

Any investment opportunity listed on the Hissedari.com platform will be owned by a SPV being a private limited company set up for this specific purpose.

No, the assets are acquired under one Special Purpose Vehicle (SPV)/entity and each investor becomes a shareholder of the same entity in proportion to the size of their investment.

Hissedari.com undertakes the legal due diligence of the property before it is purchased by the SPV. All investment and property-related legal processes are handled by Hissedari.com

However, you are welcome to seek tax and legal advice from your advisors to understand if the opportunity listed suits you. In case, you engage any legal/tax advisor, we will be happy to answer any questions that they may have.

Hissedari.com has an experienced team that performs thorough technical and legal due diligence before listing any property on our platform. We engage reputed Tier-I law firms to conduct due diligence on the property title.

Yes, you can view all the asset-related documents including the Lease/Rental/Tenancy Agreement/ Deed or Leave & License Agreement uploaded on the investor’s respective dashboards.

To begin with, you will be required to sign an Expression of Interest to confirm your commitment and remit 10% of your investment amount.

Following this, a Drawdown Notice will be sent to you once the opportunity has 100% commitment from all interested investors

A Post which you may remit the remaining funds towards your investment.

This is followed by the Offer Letter for private placement of securities and, execution of Share Securities Subscription Agreement (SSA) with the SPV. The SPV also executes the Asset Management Agreement with Hissedari.com for which you will be executing a consent letter.

At the time of resale/liquidation of your holding in the SPV, you will be required to execute securities transfer documentation which includes a request letter for the transfer of securities, a deed of adherence to the SSA, and securities transfer forms.

All these documents shall be executed through an e-signing process complete with an audit trail and no physical copies will have to be signed. This makes your investment process completely digital, fast, transparent, and very convenient.

We believe in 100% transparency. All property documents, rental agreements, tenancy details, title report, due diligence report, etc. will be available through the Investor dashboard.

Hissedari.com provides each investor access to an investor dashboard to access rental agreements, tenancy details, title report, due diligence report, 3rd party NAV reports, audit reports, and any other relevant documents. The same dashboard is used to provide real time tracking of asset performance, rental payouts, financial models, etc.

For each asset listed on the Hissedari.com Platform, a Special Purpose Vehicle (SPV) is created in which funds are raised to purchase, own and manage the property.

Your investment shall be towards subscription of the shares and compulsorily convertible debentures of the SPV that holds the property and represents your fractional investment.

Hissedari.com will provide asset management services to the SPV and undertake accounting, secretarial, reporting, leasing, maintenance, and other operational aspects under the asset management services contract with the SPV.

Can Hissedari.com re-invest my liquidated assets on the platform with your future opportunities?

No, Hissedari.co cannot invest on your behalf. You're free to invest on your own accord.

Hissedari.com uses a highly secure platform for investor’s protection. The security of our platform and the privacy of all your data is an utmost priority. Our platform is built keeping the best-in-class security and privacy features in mind.

When purchasing fractional ownership, through a platform such as ours, physical share certificates are not issued. This is normal practice in the industry. An electronic receipt is sent out for each transaction so that you can keep a copy of those for your records. Also, your ownership through SPV is documented (a) with Ministry of Corporate Affairs and the records cannot be manipulated.

Exit / Post-Investment

As a buyer, you will have the right to participate in all decisions including the timing and price at which the asset is sold.

You can exit your investment once the initial lock-in period is complete. This can be done in multiple liquidity options. Final Asset Sale:

If any lucrative opportunity comes up for selling the asset, Hissedari.com as the asset manager shall take the necessary steps to evaluate the opportunity.

After evaluation, Hissedari.com will present it to the investors in the form of an online poll to decide if the asset is to be liquidated or held. If at least 75% of the shareholders vote to sell, we will begin the process of liquidation. All related reports and documents to assist the investors in making their decision shall be provided by Hissedari.com.

Once the asset is sold, the gains (post any taxes and fees) shall be distributed amongst shareholders and remitted to the respective registered bank accounts. If shareholders vote to hold, the investment will continue as is, until the next poll where the process will be repeated

Private Sale:

You can sell your fraction/holding to anyone you may know, such as friends or family. You will be required to execute the necessary transfer documents for the same.

Hissedari.com will provide you with the valuation of your holding and require assistance in setting a price once intimated.

Secondary Market (Resale):

You can list your fraction/holding on Hissedari.com online dashboard at Hissedari.com recommended NAV, once an investor expresses interest we'll facilitate the transaction and give you an exit.

You will be required to execute the necessary transfer documents for the same. Once a new investor has acquired your fraction, you will be credited your gains (post any taxes and fees) on your registered bank account.

You can sell your fraction/holding to anyone you may know, such as friends or family. You will be required to execute the necessary transfer documents for the same.

Hissedari.com will provide you with the valuation of your holding and require assistance in setting a price once intimated.

Resale Market / Secondary Market:

You can list your fraction/holding on Hissedari.com online dashboard at Hissedari.com recommended NAV, once an investor expresses interest we'll facilitate the transaction and give you an exit.

You will be required to execute the necessary transfer documents for the same. Once a new investor has acquired your fraction, you will be credited your gains (post any taxes and fees) on your registered bank account.

Misc

REITs are publicly traded instruments. Investors buy and sell units of the REIT to receive dividends and make capital gains.

Whereas with Hissedari.com Investors are made shareholders of a Private Limited Company which owns the property. Hissedari.com manages the property on behalf of the SPV.

Yields

In a REIT, the yield varies based on your entry price. With Hissedari.com, the yields are fixed.

Volatility

As a listed product, a REIT is subject to stock market volatility which can buy out of sync with actual property value.

With Hissedari.com, Asset valuations are far more stable and only change according to ground reality.

Payouts

With REITs, the dividend payout cycle depends on the fund. It can be monthly or bi-annually. Also, a REIT is only required to distribute a minimum of 90% of the net distributable cash flows.

With Hissedari.com Payouts are made monthly and there is a complete distribution of distributable cash flows.

Non-revenue generating assets

Up to 10% of the REIT’s investment can be in under-construction (Non-revenue generating) assets. With Hissedari.com all assets are revenue-generating.

Exiting Assets

A REIT cannot sell assets that it has owned for less than 3 years. With Hissedari.com assets can be sold at any time (post the initial lock-in period) with shareholder approval.

No. To facilitate secure and easy validation of ownership documents, we prefer all financial documentation to be directed through our website to ensure transparency of all official documents. Hissedari.com team is constantly working on innovative solutions to ensure optimal user experience. As part of our tech road map, we may be launching our Investment App along with many new exciting features!