After Singapore, Indian property developers such as Indiabulls Real Estate [Get Quote] and Phoenix Mills [Get Quote] among others are looking at London, German and Australian stock exchanges to list their property trusts there.

According to experts, lower yield expectations by European investors compared to southeast Asian markets and deeper in real estate investment trust (REITs) markets in European and Australian markets due to the predominance of low-risk investments such as pension funds, insurance funds and other pool of funds have made Indian developers look at newer markets to raise money.

"Under frictionless market conditions, REITs in the UK give a dividend yield of 4-6 per cent, REITs listed in Australia give an yield of 6 per cent, while Singaporean REITs give a yield of 5-8 per cent. Lower the yield, higher the returns for the fund-raising parties," said an investment advisor with a global management consultancy.

In the European markets, pooled funds typically invest in stable income generating funds such as REITs, government gilts, pension bonds, and so on which carry lower risks and avoid turbulent stock markets.

"Moreover, the investor confidence and liquidity available in European and Australian markets are far better due to the large pool of funds available with them. These funds prefer REITs as they are perceived as safer investments," the advisor added.

REITs are tax designation for corporates, which invest in real estate. Under REITs, companies enjoy certain tax benefits but are required to distribute 90 per cent of their income, which may be taxable in the hands of the investors.

Though Indian capital markets regulator Securities and Exchange Board of India has passed the draft REIT guidelines in the country, it is yet to clear the REITs formally.

A host of Indian developers looked at listing their REITs on international markets as they would give high liquidity for their completed commercial properties compared to Indian markets and reduce their overall leverage positions during the ongoing credit crunch.

Though the Singapore Stock Exchange became the hot favourite among Indian developers due to easier listing norms, higher liquidity, closer geographical proximity to list their property trusts. DLF, Unitech and Indiabulls [Get Quote], who obtained listing permission from SGX, had deferred their public issues on SGX early this year owing to unfavourable stock market conditions.

However, Indiabulls and DLF have revived their IPO plans, while Unitech is still waiting for market conditions to improve before it goes ahead with its  $700 million issue. Indiabulls deferred closure of its $283 million public issue of Indiabulls Properties Investment Trust for a day to June 6 due to poor investor response, however DLF is expected to file the papers for its $2 billion IPO of DLF Office Trust this month.

"We have a large pool of assets and we would like to diversify into other markets. We are looking at the possibilities, which should happen in the due course,'' said Ajit Mittal, president of corporate affairs at Indiabulls group.

Indiabulls Real Estate is executing projects in 10,000 hectares, which include three special economic zones, townships and commercial projects across the country. Indiabulls Property Trust IPIT has picked up stakes in its Jupiter Mills and Elphinstone Mills development in Central Mumbai.

Another Mumbai-based developer Phoenix Mills is also looking at options to list its property trusts abroad. "We are looking at the options to raise funds but we have not finalised anything,'' said Mahesh Iyer, chief financial officer of Phoenix Mills, which is developing nearly 25 million sq ft mainly in retail, office and hospitality projects.

Earlier, Phoenix had plans to raise an offshore fund of $300 million on SGX and subsequently list a REIT, with a corpus of $2-3 billion on SGX, fund its ongoing and future projects. But the company has not gone ahead with its plans due to unfavourable market conditions, said a top company official.

According to sources, the US-based private equity funds and investment banks such as Citigroup, Lehman Brothers, Morgan Stanley, which have a large exposure to the Indian real estate, could also look at listing their Indian property portfolio in overseas stock markets where foreign REITs are allowed to be listed.

Amidst the overseas listing plans of realty companies, KPMG Executive Director Jai Mavani has a word of caution for developers.

"Real estate is witnessing an introspection all over the world. Whether it is the UK, the US or Australia, only when you have attractive valuations and good quality assets, you can raise funds."