Indian Real Estate Sees Resurgence in Private Equity Investments
Private equity investments in Indian real estate surged 15% YoY to USD 3 billion in H1 2024, driven by growth in warehousing and residential sectors.
Private Equity InvestmentsIndian Real EstateWarehousing SectorResidential SectorOffice SectorReal EstateJul 17, 2024
The residential sector also saw a surge, drawing USD 854 million, up 209% from USD 277 million in the same period last year. Mumbai, Bengaluru, and Delhi-NCR were among the leading cities for residential investments.
The office sector, meanwhile, garnered USD 579 million, constituting 20% of total PE investments. Hyderabad, Bengaluru, and the NCR emerged as the top cities for office investments.
The report highlights a shift in investor preferences, with warehousing surpassing traditional sectors like office and retail in popularity. This trend is driven by the growth of e-commerce and a shift towards optimized supply chains.
Currently, domestic investors hold approximately USD 2 billion in undeployed capital, positioning the market for further growth as global economic conditions improve. Alternative Investment Funds (AIFs) have also emerged as significant players in the Indian real estate sector, raising around USD 5.3 billion out of a targeted USD 8.2 billion since January 2021.
Looking ahead, the Indian real estate market is expected to continue its upward trajectory, driven by factors such as the expanding e-commerce industry and supportive government policies, particularly in the warehousing sector. The residential market, buoyed by rapid urbanization and a growing population, is also poised for sustained growth.
Despite a temporary slowdown in the office sector, demand for Grade A office spaces remains robust, especially in prime locations catering to Global Capability Centres. With a substantial pipeline of both undeployed capital and real estate assets, private equity investments in real estate are expected to remain robust in the foreseeable future.
Information
Knight Frank India is a leading international property consultancy that provides a comprehensive range of services across various asset classes.
Knight Frank India is a part of the Knight Frank global network, which operates in over 500 offices across 60 countries, providing a comprehensive range of services across various asset classes.
Frequently Asked Questions
What was the total private equity investment in Indian real estate in H1 2024?
USD 3 billion
Which sector emerged as the frontrunner in terms of private equity investments in H1 2024?
Warehousing sector
What was the percentage increase in private equity investments in the residential sector in H1 2024 compared to H1 2023?
209%
What is the approximate amount of undeployed capital held by domestic investors in the Indian real estate market?
USD 2 billion
What is the targeted amount of funds to be raised by Alternative Investment Funds (AIFs) focused on real estate since January 2021?
USD 8.2 billion
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