Indian real estate has witnessed a significant surge in private equity (PE) investments, reaching $4.15 billion in 2024, marking a 32% annual growth, as per Knight Frank India. This growth is primarily driven by the housing segment, reflecting robust investor confidence and consistent demand from end-users. The data highlights a noteworthy shift in investment patterns within the real estate sector.
The warehousing sector emerged as the largest recipient, attracting 45% of the total investments, amounting to $1.88 billion. This growth aligns with the rise in e-commerce and third-party logistics. The residential segment followed closely, receiving $1.18 billion, a twofold increase compared to the previous year. Meanwhile, office properties secured $1.1 billion, showcasing a stable demand despite some challenges.
Mumbai retained its position as the top investment destination, capturing 50% of total PE inflows. A substantial portion of the capital flow, estimated at $1.7 billion or 42%, originated from the UAE. Indian investors also contributed significantly, deploying $1.3 billion, while institutions from Singapore invested around $633.7 million.
Shishir Baijal, Chairman and Managing Director of Knight Frank India, emphasized that India’s economic stability and consistent growth over the last decade have bolstered private equity investments in real estate. Despite a dip in the office segment, the commercial real estate market remains resilient, supported by the return to workplaces, increasing office absorption rates, and strengthening rental values.
Knight Frank’s report, "Trends in Private Equity Investment in India 2024," underscores the growing appeal of the Indian real estate market to both domestic and international investors. This upward trend signifies confidence in India's long-term real estate prospects, positioning the sector as a critical avenue for private equity growth.
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