January to March Witnesses a Strong Rise in Institutional Investments in Indian Real Estate

The first three months of 2022, January to March, have witnessed a significant rise in institutional investments in the Indian real estate sector. Estimated to be around $1.1 billion or INR 8,375 crore, this is about a two-fold rise in just three months. This happened just as the Indian economy opened up following the third wave of the pandemic. This is substantially high, compared to the previous quarter when the investments were around $1 billion. During the same period last year, the institutional investments were around $0.5 billion.

So, the investments doubled during the first quarter this year, as compared to the same period in 2021. This points to a better sentiment of the investors, as the impact of the pandemic seems to be less harsh. The commercial real estate sector has witnessed some strong deals which fueled the high growth of real estate.

Foreign investments accounted for around 70% of the incoming cash flow. Evidently, these peo formed the prime investors during this period. Following the inception of the pandemic in 2020, the domestic investment share has reached only 30%. However, this is not a bad sign for the real estate industry, as the pre-pandemic period also shows similar statistics. Rather, it marks a resurgence in confidence among the domestic investors.

During these three months, the logistics, industrial, retail, and office segments amounted to 95% of the overall institutional investment in the sector. At 23%, the retail sector managed to account for the second-highest investment share. There were some major transactions in the retail segment. Besides, logistics assets and industrial properties accounted for $0.2 billion. This, too, resulted in around 16% of the overall investments.

As this trend continues to grow stronger, the real estate industry keeps attracting investors. With this, one can expect the industry recurringly soar in the coming years.