April 15 Despite some big-ticket launches across premium realtors being pushed back to Q1FY23 in view of Omicron-led hesitancies, pre-sales numbers across India by real estate majors indicate a strong recovery during the January–March period.

Institutional investments into the sector have seen a growth in segments like office space and logistics, while institutional investments remain muted for “residential properties”.

ICICI Securities, too said, while residential sales momentum was expected to remain healthy; the sales volume growth could be mixed, driven by new launches.

Bengaluru-based Sobha Ltd – amongst the BSE Realty index stocks – said it recorded “best ever price realisation” to ₹8,265 per square ft, and over three per cent y-o-y increase. Sales volume stood at 1.34 million sq ft of super built-up area and realisations stood at ₹1,110 crore.

Prestige Estates, also from Bengaluru, crossed ₹10,000 crore of pre-sales in FY22, up 90 per cent y-o-y; while during the Q4FY22 period its pre-sales collections increased 39 per cent y-o-y to ₹2,461 crore (₹1,768 crore). Sales volume and in value terms for the quarter-ending March 2022 were up 76 per cent and 77 per cent, respectively, y-o-y.

“The Prestige Group pre-sales stood at Rs 10382 crore during FY22. This record sales are backed by robust response to our 16.77 mn sft newly launched projects and for under construction and completed inventory,” Irfan Razack, Chairman, Prestige Group, said. Launches were up 42 per cent, y-o-y, in FY22.

Mumbai-based Macrotech Developers (formerly Lodha Realtors) saw pre-sales for the fourth quarter of the previous fiscal at ₹3,456 crore, a 37 per cent rise y-o-y. The developer said this was amongst its best quarters ever. The sales in Q4 were supported by a stamp duty waiver in Maharashtra.

HDFC Securities, in a report, said, pre-sales numbers across developers could be at an all time high. “The presales momentum may continue into Q1FY23, with incremental delta likely to accrue with new launches. We expect Prestige, Oberoi, Mahindra Life, DLF, and GPL to hit new records in Q1FY23, if launches remain on track,” it said.

Muted Launches

January–March, though, was a slow quarter for big bang launches. Prestige’s much-awaited Mumbai projects are expected to be launched from Q1FY23 onwards, say market sources.

In FY23, the group plans to launch over 15 million sq ft of offerings across projects in Mulund, Marine Lines and Pali Hill in Mumbai; and in other cities like Bengaluru, the Delhi -NCR and Chennai.

“Whilst Q4FY22 was a muted launch quarter, we expect momentum to pick up Q1FY23, with some of the major launches from Prestige (MMR, most awaited), Oberoi (Thane, long due) and Mahindra Life (Bengaluru, Chennai). We expect launches to result in a strong Q1FY23 in the absence of any Covid-19 fourth wave,” HDFC Securities’ report added.

Institutional Investments

Meanwhile, institutional investments in Indian real estate reportedly touched $ 1.1 billion during the January–March period, doubling from last year. The investment activity during the quarter was driven by some large-sized deals in the office sector.

Investments were largely driven by foreign investors, which accounted for about 70 per cent of the inflows in Jan - Mar. Domestic investments were almost at pre-pandemic levels.

The retail sector attracted the second-highest share of investments at 23 per cent. Industrial and logistics assets received inflows of $ 0.2 billion, accounting for about 16 per cent of total investments, a report by real estate consultancy firm Colliers’ said.

Investments in the residential sector remained muted - at $ 15 million in Q1 2022 – or one per cent of the total investments.

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