Real Estate Sector Sees 46% Surge in Equity Investments, Reaching $8.9 Billion in Q3 2024
Mumbai, Bengaluru, and Chennai led the way with a 66% share of investments in the Jul-Sep 2024 quarter, according to the CBRE report.
Real EstateEquity InvestmentsCbreMumbaiBengaluruReal Estate MumbaiOct 14, 2024
Equity investments encompass a wide 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 notes that this growth is the highest recorded since 2018.
In the July-September 2024 quarter, equity investments in real estate stood at $2.6 billion. Domestic investors, primarily developers, led the charge with a 79% share in equity capital inflows during this period. Singapore-based investors accounted for nearly 73% of the total foreign capital inflows, followed by the United States with around 22%.
Developer activity saw a notable uptick in the July-September 2024 quarter, accounting for nearly 47% of total equity investments. Institutional and collective vehicle investors followed with approximately 36%.
Mumbai, Bengaluru, and Chennai were the top cities for equity investment activity, collectively accounting for over 66% of the total investments during this period. These metros are expected to continue attracting significant equity inflows, though SEBI’s SM REIT regulations also highlight opportunities in quality assets in smaller, tier-II locations.
Land and development sites dominated the investment landscape, capturing a 45% share of the market. The office sector followed with a 24% share, while the retail sector saw a resurgence, capturing around 22% of the capital inflows.
Approximately 56% of the total capital inflows in land and site acquisitions were allocated to residential developments. The remaining funds were directed towards retail, data centers, warehousing projects, and hospitals.
In addition to the $2.6 billion in capital infusion, investment and development platforms worth around $235 million were established during the quarter across the hotels 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 a new peak in the first nine months of 2024, driven by a resurgence in capital deployment in the second quarter. Sustained capital inflows are expected across both traditional and emerging sectors in the coming quarters, with institutional and collective vehicle investors, as well as developers, driving overall capital flows.'
Frequently Asked Questions
What was the total equity investment in the real estate sector during Jan-Sep 2024?
The total equity investment in the real estate sector during Jan-Sep 2024 reached $8.9 billion, marking a 46% increase year-over-year.
Which cities accounted for the majority of the investments in the July-September 2024 quarter?
Mumbai, Bengaluru, and Chennai collectively accounted for over 66% of the total investments during the July-September 2024 quarter.
What was the primary source of capital inflows in the July-September 2024 quarter?
Domestic investors, primarily developers, led the charge with a 79% share in equity capital inflows during the July-September 2024 quarter.
Which sectors dominated the capital inflows in the July-September 2024 quarter?
Land and development sites dominated the investment landscape with a 45% share, followed by the office sector with a 24% share, and the retail sector with a 22% share.
What are the expectations for future investment trends in the real estate sector?
Sustained capital inflows are expected across both traditional and emerging sectors in the coming quarters, with institutional and collective vehicle investors, as well as developers, driving overall capital flows.
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