Institutional real estate investment more than doubles to $1.1 billion in January-March.

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Jun 17, 2022 |
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Institutional real estate investment more than doubles to $1.1 billion in January-March.

Institutional real estate investment more than doubles to $1.1 billion in January-March:

* “Institutional investment in Indian real estate reached USD 1.1 billion in the first quarter of 2022, more than tripling from the same quarter the previous year.” According to a real estate consultant business in a state, “the opening up of the economy following the third wave of COVID-19 infections, as well as an increase in investor mood, has resulted in soaring investments compared to the preceding quarter.”

New Delhi: With the economy opening up following the third COVID wave, institutional real estate investments more than doubled to USD 1.1 billion (Rs 8,375 crore) in the three months ending March 2022, according to a property consultant in India. Institutional real estate investments totalled USD 0.5 billion in the preceding quarter and USD 1 billion the year before.

*“Institutional investments in Indian real estate totalled USD 1.1 billion in the first quarter of 2022, more than tripling from the same time the previous year.” In comparison to the previous quarter, the economy has opened up following the third wave of COVID-19 infections,” noted a real estate consultant business in a state.

Large-scale acquisitions in the office sector drove investment activity during the period under review.

*”Foreign investors drove the majority of inflows during the quarter, accounting for almost 70% of total inflows.” Surprisingly, following a decline in 2020, the percentage of domestic investments has nearly recovered to pre-pandemic levels, at 30%. “This demonstrates a recovery in domestic investor confidence,” the expert stated.

During the January-March quarter, the office, retail, and industrial & logistics divisions accounted for 95% of total institutional investment in the real estate industry.

The retail sector, supported by one significant deal, drew the second-highest percentage of capital, at 23%. Industrial and logistical assets got USD 0.2 billion in inflows, accounting for approximately 16% of overall investments.

Data centre investments increased to almost USD 40 million in Q1 2022, as multinational data centre REITs, data centre management firms, and Hyperscalers continued to invest in India.

According to a consultant, residential investments remained sluggish in the first quarter of 2022, attracting only USD 15 million, or around 1% of overall assets.

According to the consultant, domestic investors remain optimistic about the industry. They aggressively raise funds and expect investment momentum to increase in the following quarters.

*”The real estate sector has undergone positive structural changes, and performance indicators reflect strong comeback across Residential, Office, Industrial, and Logistics sectors, with newer themes around technology and digital emerging,” said a Managing Director of a property consulting firm.

According to the expert, local and international investors are optimistic about Indian real estate, supported by pro-growth government policies, with a long-term vision to build and keep properties.

*”In Q1 2022, multi-city agreements accounted for 65% of all investments, as investors focused on forming strategic relationships with prominent developers and acquiring/developing portfolios spanning numerous cities. “We’re also witnessing the establishment of platforms for investing in certain asset classes, particularly across the commercial office and industrial asset classes,” said a property consultancy firm’s senior director and head of research.

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