Private equity investments inflows into the Indian real estate sector stood at $3.4 billion at the end of 2022. This is at par with the investment quantum registered in 2021, says a new report by property consulting firm Savills India. The brokerage firm expects $3.5-4.0 billion of private equity investments in real estate in 2023.
Commercial office assets remained the most preferred PE investment recipient during 2022, claiming share. Residential and retail sectors also witnessed robust growth, riding high on the end-user’s demand.
“Commercial office remains the preferred investment product in India which absorbs around a third of the total APAC office demand by space. With the increase of office REITs, this trend will grow as domestic investor participation increases. Data centres have been the second most visible investment product in 2022. India remains a favourable destination for global real estate investors despite the global events and we will witness newer offshore capital enter India in 2023.” said Diwakar Rana, MD, capital markets, Savills India.
“This year marked the largest acquisition of an operational retail asset in India in the last 5 years and also one of the lowest residential inventory overhangs in over a decade,” says the report.
Persisting geopolitical challenges amid the ongoing Russia-Ukraine war, high global inflation, a fresh COVID outbreak and lockdown in China have slowed down the post-pandemic economic recovery across the globe. However, despite these global economic pressures PE investments in Indian real estate assets provided favourable avenues for both global and domestic institutional investors, the report points out.
Manufacturing sector growth and digitisation of the economy are likely to drive investments in industrial and warehousing, data centres and life sciences segments.
Housing News Desk is the news desk of leading online real estate portal, Housing.com. Housing News Desk focuses on a variety of topics such as real estate laws, taxes, current news, property trends, home loans, rentals, décor, green homes, home improvement, etc. The main objective of the news desk, is to cover the real estate sector from the perspective of providing information that is useful to the end-user.
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