Institutional investments in Indian real estate touched $3.6 billion in January-September 2022, an increase of 18 per cent YoY from last year, which was $3.0 billion, finds a report.

The office sector, which contributed 50 per cent of the inflows, and the retail sector were the main drivers of inflows, according to a report by Colliers. Investments into the office sector rose 53 per cent YoY during the first three quarters of 2022.

Active participation

“The capital in Indian real estate is getting more broad-based with active participation also from domestic institutional and retail Investors. Domestic capital is seen to flow across asset acquisitions, with credit in multiple asset classes with varied pooled structures. The current state of economics, with respect to inflation and interest rates, is not perceived to have a long-term impact.” said Piyush Gupta, Managing Director, Capital Markets and Investment Services, Colliers India. 

The report shows increased domestic market activity, with investment inflows, now accounting for 18 per cent of the market, up from 14 per cent during the same period last year. However, with greater involvement in entity-led acquisitions, international investors continue to dominate funding activities.

Expected slowdown

“Over the next few quarters, while there may be some slowdown in deployment of funds due to the recession, we believe that the Indian market is relatively well-insulated and investors continue to view it favorably,” Vimal Nadar, Senior Director and Head of Research, Colliers India.

It also states that the industrial and logistics assets are high on investors’ radar with several platforms being formed for the development of assets in this space.

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