The real estate sector witnessed $1.6 billion worth of institutional investments in the second quarter of 2023, up 33.3 percent from the previous quarter but down 40.7 percent from the year-ago period, highlighting a certain level of volatility in the market, Vestian, a commercial real estate consultant based in Bengaluru, has said in a report.
The share of investments in commercial assets (office, retail, co-working, and hospitality projects) increased to 88 percent in the April-June period of 2023 from 39 percent in Q1 2023, indicating a renewed demand for office spaces.
In contrast, the share of the residential sector declined from 27 percent in the previous quarter to a mere 4 percent in the second quarter, as lower-yielding investments found less appeal with institutional investors, it said.
“Institutional investments have grown significantly during Q2 2023 compared to the previous quarter. This upward trajectory in investments demonstrates renewed interest from institutional investors amidst the challenging macroeconomic landscape. The real estate sector is likely to garner increased traction in the upcoming quarters on the back of robust GDP growth and a strong pipeline of upcoming infrastructure developments,” said Shrinivas Rao, FRICS, CEO, Vestian.
Foreign investors dominated the total institutional investments, with a 92 percent share as investors are bullish about India’s growth story. The majority of the investment deals were multi-city deals, accounting for around 94 percent, the report titled Institutional Investment in Indian Real Estate Q2 2023, said.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
