India Emerges as a Major Player in APAC's Cross-Border Real Estate Market
India secures 9% of APAC's cross-border real estate investments in H1 2024, with USD 3 billion flowing into Indian real estate, driven by global private equity investors.
Real EstateApacCrossborder InvestmentsIndiaKnight FrankReal EstateAug 12, 2024
This translated to around USD 3 billion flowing into Indian real estate, showing a growing interest from global private equity investors. The overall cross-border investments in the APAC region amounted to USD 11.5 billion during the same period.
The Indian real estate sector demonstrates a strong attraction, particularly in commercial properties. The office sector leads the charge, accounting for 36% of total investments from abroad. This trend highlights the critical demand for office spaces, particularly as companies adapt to hybrid work models and seek modern facilities.
Following the office sector is the industrial real estate niche, which has attracted 30% of the investment share. This interest can be attributed to India's growing manufacturing capabilities and logistical networks. In contrast, the residential sector received 15% of investment, while retail drew in 10%. This distribution suggests that while residential and retail markets are still active, commercial properties are where the bulk of foreign interest lies.
The increase in cross-border capital is reshaping the commercial real estate landscape throughout APAC. Experts anticipate that future monetary policies, including potential rate cuts, will likely boost this trend even more. Such changes may lead to an increase of over one-third in cross-border investments for the latter half of 2024 compared to the same period last year.
Investors are on the lookout for new opportunities, and India's diverse real estate landscape offers attractive options. When comparing major markets within APAC, Australia is expected to attract the most foreign investment in the second half of 2024, with an impressive predicted increase of 129% from the previous year.
The full-year forecast also predicts that Australia, Japan, and Singapore will remain the top three destinations for cross-border capital in the APAC region, with shares of 36%, 23%, and 11%, respectively. This indicates a competitive environment where India will have to maintain its appeal to foreign investors amidst these leading markets.
Another vital aspect to consider is the evolving regulatory environment in India, which has made strides in simplifying processes and enhancing transparency in real estate transactions. Initiatives like the Real Estate (Regulation and Development) Act (RERA) and Goods and Services Tax (GST) have positively impacted investor confidence.
Furthermore, urbanisation trends and government initiatives aimed at improving infrastructure are driving demand for real estate, enhancing the long-term prospects for investors. In summary, India's position in the APAC cross-border real estate investment landscape is strengthening, with foreign investors showing keen interest in both commercial and industrial sectors.
As economic conditions evolve and regulatory frameworks improve, India may well continue this positive trajectory, ensuring it remains a coveted destination for global capital. The potential for further growth is significant, and as more players enter the market, India is set to become a central hub for real estate investment in the near future.
Frequently Asked Questions
What percentage of APAC's cross-border real estate investments did India secure in H1 2024?
9%
How much foreign investment flowed into Indian real estate in H1 2024?
USD 3 billion
Which sector leads the charge in attracting foreign investments in Indian real estate?
Office sector
What is the predicted increase in cross-border investments for the latter half of 2024 compared to the same period last year?
Over one-third
Which country is expected to attract the most foreign investment in the second half of 2024?
Australia
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