As per the latest reports, private equity investments seem to be healthy and growing in the Indian real estate sector, thereby indicating that all is well on this front or at least that things are rapidly stabilizing. Recent studies and reports highlight PE investments touching a whopping Rs. 59, 100 crore in Indian real estate in 2017 which is 36% higher than Rs. 17, 200 crore pumped in by PE investors in the year 2014.
A large chunk of PE investments have gone towards commercial realty projects. Rs. 57, 300 overall has been invested in real estate from 2011 onwards as per reports. Mumbai attracted the most interest from PE investors with approximately 40% of investments going into its commercial real estate market while another Rs. 11, 350 crore went into the NCR (National Capital Region).
Bangalore also drew PE investments to the tune of Rs. 7, 850 crore as per reports. Apart from commercial and residential real estate, there were major investments made in the warehousing and retail sectors as well. The former witnessed Rs. 28, 136 crore flowing in from 2014 onwards while the latter sector had Rs. 10, 362 crore coming in from 2011 onwards as per reports. Almost 50% of capital in the real sector has been invested for developing new projects and other retail assets which are currently being constructed.
Investors are more bullish about the Indian real estate market now that there is increased transparency due to reforms such as RERA, GST and demonetization. Improved buyer sentiments and economic growth are other major factors propelling investor interest in Indian real estate. The sector is steadily evolving towards higher maturity according to experts. For H1 2018, PE investors have already put in Rs. 33, 700 crore in the sector. The office market remains a high performer while retail and warehousing segments should continue attracting investors as per reports. The residential segment should also do well over the coming months with sales volumes going up across major cities. The Government’s thrust on affordable housing also seems to be working for the revival of the sector. Some of the top projects in the residential market at present include Lodha Codename Move Up, Godrej Meridien and Brigade Woods among others.
