Real estate corners ₹10,080 cr PE investment

The higher demand for office and co-working space in India has driven the interest of institutional investors’ in office and retail properties and this in turn has resulted in attracting a whopping private equity investments worth over ₹10,080 crore during the latest quarter ended June. During the quarter, the office sector continued to rise on sequential basis too, making up for around 42% of the net inflow share across the key six segments and the same is expected to remain in focus in the forthcoming quarters as well. Office sector recorded inflows of ₹4,295 crore, a 39% increase from the corresponding quarter last year. This segment constituted almost half the investments committed by foreign investors, retail segment constituted 26%, and industrial segment had a 10% share in investments by foreign investors.

According to the stats from Cushman & Wakefield, though the inflow has witnessed a 22% year-on-year dip but it has still eclipsed investments of the second quarter of the previous 11 years, being the second highest. With the government initiating a series of reforms, institutional investors, including private equity, sovereign wealth and pension funds, continue to express a healthy appetite for Indian real estate. Major policy initiatives, which have resulted in change in global investors’ perception of Indian real estate, include implementation of the Real Estate (Regulation and Development) Act, 2016 (RERA), the Benami Transactions (Prohibition) Amendment Act, 2016, infrastructure status to affordable housing sector, demonetization, interest subvention schemes, relaxation of norms to encourage Real Estate Investment Trust (REIT) listings and the Goods and Services Tax.
Published on 04 August 2018
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