India's Real Estate Sector Set to Exceed USD 10 Billion in Equity Investments in 2024
In 2024, the Indian real estate market is witnessing a surge in equity investments, with institutional and collective vehicle investors contributing significantly to the growth.
Real EstateEquity InvestmentsIndian MarketInstitutional InvestorsCapital InflowsReal Estate NewsNov 27, 2024
In 2024, institutional and collective vehicle investors have remained a crucial source of capital for the Indian real estate market, making up nearly 40% of total investments from January to September. Developer companies have led the way, accounting for over 41% of the total capital inflows during this period.
Domestic investors, primarily developers, have injected nearly USD 6 billion in the first nine months of the year, capturing almost 65% of the overall capital inflows. In contrast, foreign investors have contributed around USD 3.1 billion during the same period. Notably, investors from North America and Singapore have been the major players, together representing roughly 85% of all foreign capital inflows.
The surge in equity inflows, which reached USD 8.9 billion in the first nine months of the year, marks a remarkable 46% year-on-year growth. According to the report, deal volumes have continued to rise, with around 200 transactions reported compared to 151 in the same period last year. The average deal size has also grown significantly, climbing to USD 45 million from USD 36 million in 2023. Mid-sized deals, ranging from USD 10 million to USD 50 million, have played a pivotal role, representing 56% of total investments.
A resurgence in office sector inflows, growing by 50% year-on-year, underscores its appeal to investors. Alongside office assets, land and development sites have attracted more than 70% of total inflows. Residential developments have dominated this category, accounting for 64% of the investments, while mixed-use projects and infrastructure developments like data centres, warehouses, and hospitals have also drawn significant capital.
Major urban hubs such as Delhi-NCR, Mumbai, and Bengaluru have led the charge, collectively capturing over 63% of total investments. Delhi-NCR has emerged as the top recipient, with USD 2.3 billion in inflows, while tier-II and III cities, including Ludhiana, Mohali, and Coimbatore, have collectively attracted USD 0.6 billion.
Debt financing has also hit a record, exceeding USD 4.7 billion in January-September 2024, marking a twofold increase compared to the previous year. Approximately 60% of this financing has been concentrated in key markets like Delhi-NCR, Mumbai, and Bengaluru, further emphasizing their strategic importance.
This milestone reinforces the resilience and adaptability of India's real estate sector. With increasing deal sizes, strategic foreign investments, and a robust acquisition pipeline, the industry is well-positioned for sustained growth in the coming years.
Frequently Asked Questions
What is the projected equity investment in India's real estate sector for 2024?
Equity investments in India's real estate sector are projected to surpass USD 10 billion for the first time in 2024, with a forecast range between USD 10 billion and USD 11 billion.
Who are the major sources of capital for the Indian real estate market in 2024?
Institutional and collective vehicle investors are a significant source of capital, making up nearly 40% of total investments from January to September 2024.
How much have domestic investors contributed to the real estate market in the first nine months of 2024?
Domestic investors, primarily developers, have injected nearly USD 6 billion in the first nine months of 2024, capturing almost 65% of the overall capital inflows.
Which urban hubs have led the real estate investment in India in 2024?
Major urban hubs such as Delhi-NCR, Mumbai, and Bengaluru have collectively captured over 63% of total investments. Delhi-NCR has emerged as the top recipient with USD 2.3 billion in inflows.
What is the trend in deal volumes and average deal size in 2024?
Deal volumes have continued to rise, with around 200 transactions reported compared to 151 in the same period last year. The average deal size has grown significantly, climbing to USD 45 million from USD 36 million in 2023.
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