PE investment in real estate climbs to $1.3 billion in Q2: Savills India

Private equity investment in India’s real estate market climbed 85 percent to $1.3 billion

Private equity investment in India’s real estate market climbed 85 percent to $1.3 billion (Rs 10,700 crore) in the second quarter of calendar 2023, even amid global recessionary concerns, according to Savills India, a consulting firm.

Commercial office assets maintained their leading position, capturing 66 percent of the investment. The inflows were at $704 million in Q2 of 2022.

The report suggested that the investments in the first quarter were entirely from foreign institutional investors, with a majority focused on core office assets in Mumbai, the National Capital Region (NCR), and Hyderabad. Industrial and logistics assets in the NCR and Mumbai accounted for 20 percent of the quarterly investment.

Several large-scale transactions that had been in the pipeline for over a year were completed in the quarter, Savills India said.

“The influx of private equity investments has not only fuelled the development of large-scale projects but has also supported the growth of niche segments such as warehousing, logistics, and co-working spaces,” said Diwakar Rana, managing director, capital markets, Savills India.

The introduction of India's maiden retail real estate investment trust, the Blackstone-backed Nexus Select Trust REIT, is expected to attract increased interest from domestic and international investors, Rana said. This signifies the growing maturity of the market and the wider recognition of real estate as an appealing asset class, he added.