International Players Dominate India's Real Estate Institutional Investments with 54% Share
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Synopsis
In 2024, foreign investors commanded a significant 54% share of institutional investments in India's real estate, totaling $3.7 billion. Despite a decline in share, the overall investment value surged by 36%. Domestic investors mirrored this increase while co-investments saw a remarkable rise, highlighting a growing trend in the sector.
Key Takeaways
- Foreign investors held a 54% share in 2024.
- Institutional investments totaled $6.8 billion.
- Residential sector attracted $2 billion.
- Co-investments surged by 61-fold in value.
- Industrial sector investments increased by 203%.
New Delhi, Jan 15 (NationPress) International investors took the lead in institutional investments within India's real estate sector, capturing a substantial 54 percent share in 2024, which translates to $3.7 billion, as reported on Wednesday.
Even though their share decreased, the investments surged by 36 percent in value, according to findings from Vestian Research.
Domestic investors mirrored this trend, with their share dipping to 30 percent in 2024 from 35 percent the previous year, despite also experiencing a 36 percent increase in value during that period, the report highlights.
Notably, co-investments gained momentum in 2024, as international investors sought the local expertise of domestic players amidst ongoing macroeconomic uncertainties.
This co-investment approach accounted for 16 percent of total investments in 2024, showcasing a staggering 61-fold increase in value, as noted in the report.
Total institutional investments reached $6.8 billion in 2024, marking an impressive annual growth of 61 percent.
Despite considerable investments in the industrial and warehousing sectors, commercial assets remained predominant with a 35 percent share.
“With the growing demand for GCCs in India, office spaces are projected to see a resurgence in demand,” the report indicated.
Conversely, the residential sector attracted investments amounting to $2 billion, representing 30 percent of total investments in 2024.
This sector witnessed a remarkable 171 percent increase in investments compared to the previous year. Similarly, the industrial and warehousing sectors experienced an annual growth of 203 percent, with their share rising from 15 percent in 2023 to 28 percent in 2024.
Shrinivas Rao, FRICS, CEO of Vestian, stated, “Despite a sluggish start, the real estate sector garnered substantial institutional investments in 2024, exceeding pre-pandemic levels. Nonetheless, 2025 may present challenges stemming from escalating geopolitical tensions, a deceleration in the global economy, and heightened inflation rates.”
“On a positive note, the RBI is expected to lower the repo rate in 2025, offering a boost to the real estate market. Increased activity in real estate due to lower mortgage rates could entice investors,” he added.
Factors such as return-to-office policies, government initiatives like the Production Linked Incentive (PLI) scheme, and a heightened focus on affordable housing are likely to stimulate real estate demand in the upcoming years, potentially attracting more investors, the report concluded.
sps/na
