July 15, 2024: The Indian real estate sector witnessed institutional investments of $3.1 billion in the second quarter (Q2) of 2024, registering a sharp increase of 96% over the same quarter a year ago (YoY) and 464% over the previous quarter (QoQ), according to a report by Vestian. As the world economy is stabilising amid geopolitical challenges, investors actively participated, resulting in the highest institutional investments in a quarter post the pandemic.
| Quarters | Institutional Investments
($ bn) |
Quarterly Change
(%) |
| Q2 2023 | 1.6 | 28% |
| Q3 2023 | 0.7 | -57% |
| Q4 2023 | 0.8 | 18% |
| Q1 2024 | 0.6 | -31% |
| Q2 2024 | 3.1 | 464% |
Foreign investors accounted for the highest share, 71%, of the total investments received during the second quarter of 2024 as they flocked to India to capitalise on its robust economic growth. On the other hand, domestic investors accounted for around 20% share of the total investments in Q2 2024, which has declined significantly from 98% a quarter earlier. However, investments in value terms have increased by 18% over the previous quarter.
| Investor type | Institutional Investments
($ nn) |
% Share | % Change | |||||
| Q2 2024 | Q1 2024 | Q2 2023 | Q2 2024 | Q1 2024 | Q2 2023 | Q2 2024 vs Q1 2024 | Q2 2024 vs Q2 2023 | |
| Foreign | 2,218.1 | 11.0 | 1,459.2 | 71.2% | 2.0% | 91.7% | 20,064% | 52% |
| India-dedicated | 637.9 | 541.1 | 127.0 | 20.5% | 98.0% | 8.0% | 18% | 402% |
| Co-investment | 260.2 | Negligible | 5.5 | 8.3% | NA | 0.3% | NA | 4,233% |
| Total | 3,116.3 | 552.1 | 1,591.7 | 100% | 100% | 100% | 464% | 96% |
Shrinivas Rao, FRICS, CEO, Vestian, said, “Indian real estate sector garnered significant investments in the second quarter of 2024, dominated by foreign investors as the looming uncertainty over the major economies of the world has faded away. Moreover, domestic investors have also actively participated to capitalise on the robust economic growth.”
The industrial and warehousing sector reported a single large deal worth $1.5 billion, accounting for 48% of the total investments received in Q2 2024. The deal was concluded between Abu Dhabi Investment Authority (ADIA), KKR and Reliance Retail Ventures Limited (RRVL). Residential and commercial (office, retail, co-working and hospitality projects) assets followed with 24% and 20% share, respectively. A yearly decline of 56% during Q2 2024 in commercial investments (in value terms) was due to the conclusion of a major deal between GIC and Brookfield during Q2 2023.
| Asset type | Institutional Investments
($ mn) |
% Share | % Change | |||||
| Q2 2024 | Q1 2024 | Q2 2023 | Q2 2024 | Q1 2024 | Q2 2023 | Q2 2024 vs Q1 2024 | Q2 2024 vs Q2 2023 | |
| Commercial | 622.3 | 231.6 | 1,400.0 | 20.0% | 41.9% | 88.0% | 169% | -56% |
| Residential | 732.8 | 225.0 | 57.8 | 23.5% | 40.8% | 3.6% | 226% | 1,168% |
| Industrial and Warehousing | 1,500.0 | 58.9 | 133.9 | 48.1% | 10.7% | 8.4% | 2,447% | 1,020% |
| Diversified | 261.2 | 36.7 | Negligible | 8.4% | 6.6% | NA | 612% | NA |
| Total | 3,116.3 | 552.1 | 1,591.7 | 100% | 100% | 100% | 464% | 96% |
Multi-city deals accounted for 61% of the total investments reported in Q2 2024, followed by Mumbai and Hyderabad with 13% and 12% respectively. KKR, ADIA, GIC, Xander, Blackstone, Mitsui, Nisus Finance, SWAMIH Fund and HDFC Capital were some of the more prominent investors during the current quarter.
“Investments are anticipated to increase in the upcoming quarters on the back of robust economic growth and infrastructure development,” Rao added.
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