Real Estate Equity Investments Surge by 46% to Reach $8.9 Billion in Q1-Q3 2024
Equity investments in the real estate sector surged by 46% year-on-year, reaching $8.9 billion in the first nine months of 2024. Mumbai, Bengaluru, and Chennai accounted for a significant 66% share of these investments in the July-September quarter.
Real EstateEquity InvestmentsCbreIndiaMarket MonitorReal EstateOct 14, 2024
Equity investments encompass a range of sources, including private equity funds, pension funds, sovereign wealth funds, institutional investors, real estate developers, real estate fund-cum-developers, investment banks, corporate groups, and REITs. The report highlights that the $8.9 billion in investments is the highest recorded since 2018, surpassing the $7.4 billion total equity investments for the entire year of 2023.
In the July-September 2024 quarter, equity investments in the real estate sector stood at $2.6 billion. Domestic investors, primarily developers, accounted for around 79% of these equity capital inflows. Singapore-based investors led the foreign capital inflows, contributing nearly 73%, followed by the United States with approximately 22%.
The developer activity picked up pace in the July-September quarter, accounting for nearly 47% of total equity investments. Institutional and collective vehicle investors followed with about 36% of the investments.
Mumbai, Bengaluru, and Chennai were the leading cities for equity investment activity in the July-September period, collectively accounting for over 66% of the total investments. Investors are expected to continue focusing on metros and tier-I cities. However, the Securities and Exchange Board of India (SEBI)’s SM REIT regulations also highlight potential investment opportunities in quality assets in tier-II locations.
Land and development sites dominated the investments with a share of 45%, followed by the office sector with 24%. The retail sector experienced a resurgence in capital inflows, capturing around 22% of the investments. About 56% of the total capital inflows in site/land acquisitions were directed towards residential developments, while the remaining was allocated to retail, data centers, warehousing projects, and hospitals.
In addition to the $2.6 billion capital infusion in the July-September quarter, investment and development platforms worth approximately $235 million were established across the hotel and residential sectors.
Anshuman Magazine, Chairman and CEO of CBRE for India, South-East Asia, Middle East, and Africa, commented, “Investment activity in India’s real estate market reached new heights in the first nine months of 2024, driven by robust capital deployment in Q2 2024 (April-June). We anticipate sustained capital inflows in both traditional and emerging sectors in the upcoming quarters, with institutional and collective vehicle investors, along with developers, leading the overall capital flows.”
Frequently Asked Questions
What is the total equity investment in the real estate sector from January to September 2024?
The total equity investment in the real estate sector from January to September 2024 was $8.9 billion.
By how much did equity investments in real estate grow year-on-year in 2024?
Equity investments in real estate grew by 46% year-on-year in 2024.
Which cities accounted for the majority of real estate investments in the July-September quarter of 2024?
Mumbai, Bengaluru, and Chennai accounted for a 66% share of real estate investments in the July-September quarter of 2024.
What sectors were the main recipients of capital inflows in the real estate market in the July-September quarter of 2024?
Land and development sites dominated with a 45% share, followed by the office sector with 24%, and the retail sector with 22%.
What role did domestic and foreign investors play in the real estate equity investments in the July-September quarter of 2024?
Domestic investors, primarily developers, accounted for around 79% of the equity capital inflows, while Singapore-based investors led foreign capital inflows with nearly 73%, followed by the United States with approximately 22%.
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