Real estate fractional ownership platform Strata has surrendered its registration with the Securities and Exchange Board of India (SEBI) amid the ongoing legal issues involving its promoter. The capital market regulator has accepted the surrender application of Strata SM REIT while issuing a cautionary note to investors.
The company had received SEBI's approval to launch its SM REIT in January. Strata’s surrender of its license follows reports of a legal dispute with a Tamil Nadu-based realty developer over a warehousing asset in Hosur. The dispute has triggered investor concerns over due diligence and asset control.
“Strata SM REIT has surrendered its certificate of registration as an SM REIT and will not hold out or represent itself as a SEBI regulated intermediary or SM REIT,” SEBI said, cautioning investors to exercise discretion while dealing with the entity.
The regulator stated through a release, it had reviewed certain legal proceedings against Strata’s promoter and held discussions with the entity’s trustee, independent director, and compliance officials before concluding the process.
“In light of the ongoing matter, we have voluntarily surrendered our SMREIT licence, without admitting or denying any wrongdoing, as a measure of abundant caution. Upon the conclusion of the current litigations, we intend to apply for a fresh licence at a future date. This matter does not affect the existing investments with Everstrat,” Strata said in a statement.
According to the company, the surrender of the license does not affect existing investors or the assets of Strata, with business continuity at the Bengaluru-based firm remaining normal.
Strata had previously presented itself as an early mover in the fractional real estate space, facilitating investments in commercial real estate through co-ownership models. It was also among the first to position itself for regulatory compliance through the SM REIT route after SEBI finalized the framework in March 2024.
SEBI further clarified that Strata had not launched any schemes under the SM REIT framework, nor had it migrated any of its existing fractional real estate assets under the new regulatory regime.
The regulator’s move comes months after Strata became one of the first platforms to receive a license under the newly introduced SM REIT structure, aimed at bringing greater oversight to the rapidly growing fractional ownership market.
Started in May 2019, Strata’s assets under management currently stands at Rs 2,200 crore and a 3.5 million sq ft portfolio of rent-generating assets across key property markets of Mumbai, Pune, Bangalore, Hyderabad, Chennai, and Ahmedabad
The company had received SEBI's approval to launch its SM REIT in January. Strata’s surrender of its license follows reports of a legal dispute with a Tamil Nadu-based realty developer over a warehousing asset in Hosur. The dispute has triggered investor concerns over due diligence and asset control.
“Strata SM REIT has surrendered its certificate of registration as an SM REIT and will not hold out or represent itself as a SEBI regulated intermediary or SM REIT,” SEBI said, cautioning investors to exercise discretion while dealing with the entity.
The regulator stated through a release, it had reviewed certain legal proceedings against Strata’s promoter and held discussions with the entity’s trustee, independent director, and compliance officials before concluding the process.
“In light of the ongoing matter, we have voluntarily surrendered our SMREIT licence, without admitting or denying any wrongdoing, as a measure of abundant caution. Upon the conclusion of the current litigations, we intend to apply for a fresh licence at a future date. This matter does not affect the existing investments with Everstrat,” Strata said in a statement.
According to the company, the surrender of the license does not affect existing investors or the assets of Strata, with business continuity at the Bengaluru-based firm remaining normal.
Strata had previously presented itself as an early mover in the fractional real estate space, facilitating investments in commercial real estate through co-ownership models. It was also among the first to position itself for regulatory compliance through the SM REIT route after SEBI finalized the framework in March 2024.
SEBI further clarified that Strata had not launched any schemes under the SM REIT framework, nor had it migrated any of its existing fractional real estate assets under the new regulatory regime.
The regulator’s move comes months after Strata became one of the first platforms to receive a license under the newly introduced SM REIT structure, aimed at bringing greater oversight to the rapidly growing fractional ownership market.
Started in May 2019, Strata’s assets under management currently stands at Rs 2,200 crore and a 3.5 million sq ft portfolio of rent-generating assets across key property markets of Mumbai, Pune, Bangalore, Hyderabad, Chennai, and Ahmedabad
