Real Estate private equity investment recorded nearly 1.3x growth with a total inflows of Rs 13120 crore for the third quarter of CY 2022, said Cushman and Wakefield in its latest report.
The report mentions that the office segment attracted highest investor interest with inflows of around Rs 7990 crore. On a city-level, Bengaluru (21%) witnessed a high share in fund flow, followed by Delhi (18%) and Mumbai (15%). Multi-city investments accounted for close to 26% of the fund inflows for Q3.
“A lot of investors are backing commercial developments in cities like Bengaluru, Mumbai and Delhi NCR as the demand for office space is on an upward trajectory on the back of more and more employees returning to office,” the report mentioned.
“The recovering inflow of investments driven by foreign investors is a strong indicator that despite global headwinds, the Indian economy and the real estate sector are in sync to tackle the imminent macroeconomic risks. With strong demand observed in Grade A office and retail spaces alongside healthy performance in the residential segment, the overall investment sentiment will be optimistic in the coming years.
The report further mentioned that Q3 recorded corporate office space transaction volumes of Rs1340 crore, a q-o-q increase of 16.30%. Mumbai constituted a majority share of 59% of the total investment volume during the quarter, followed by Bengaluru with a 28% share.
The growth in this investment inflow can be attributed to the resilience shown by the Indian economy and the robust growth of GDP in the June-22 quarter. The report observed that India’s real GDP grew by 13.5% y-o-y as of the quarter ending June-2022, it mentioned.
Foreign investors constituted a majority share of 67% in the quarter’s investment volume with the majority of them coming into the office segment. Debt investments held a lesser share of 8% in the fund flows for Q3 with notable debt inflows from BPEA credit and Credit Suisse, while equity investments, with 92% share, constituted a larger share in the quarter.