Indian real estate sector attracts $922 m investments in Q1

Anil Urs Bengaluru | Updated on April 27, 2021

With 42% share, Hyderabad tops Indian cities

Institutional investments continued the momentum during the first-quarter (Q1) of calendar 2021, registering a 21 per cent growth in volumes at $922 million ($763 million), indicating sustained investor interest in the domestic real estate market.

According to JLL’s Capital Markets Update for Q1 2021, among the cities Hyderabad saw investments with 42 per cent share, followed by Mumbai at 21 per cent.

Hyderabad witnessed the highest capital flows of $384 million ($100 million), Mumbai $193 million ($54 million), Delhi NCR $107 million ($171 million), Pune $7 million ($8 million), Bengaluru - - ($385 million) and Chennai ($35 million).

“Investments during the quarter were driven by more activity from funds and closed development stage deals and were further supported by external macroeconomic factors. However, the pandemic surge during the second-half of March 2021 is expected to delay the investment pipeline in the second quarter,” revealed JLL’s Capital Markets Update.

“The remarkable resilience of the office market and confidence in its long-term growth led investors to chase quality assets available at the core and development stages. We also see the maturing listed REIT market providing an alternative to other asset classes, which lacked income stability,” Samantak Das, Chief Economist and Head of Research & REIS (India), JLL, said.

Commercial office space

Commercial office assets dominated deals with $864 million transacted, translating into 94 per cent of the total value in the first quarter. Office space developers liquidated their portfolios to deleverage or raise growth capital for the next phase of expansion. In addition, investors are actively scouting for warehousing assets at present and deals are likely to be concluded in the coming quarters. The housing sector, meanwhile, continues to experience an infusion of last-mile funding for project completion.

Published on April 27, 2021

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