PE investment inflow into Indian real estate stands at USD 322 mn in Q3 2022: Report

New Delhi, Oct 14 (Mayank Nigam) Private Equity (PE) investment inflow into the Indian Real Estate sector stood at USD 322 million (INR 26 billion) in Q3 2022, according to the latest report by Savills India, a global property consulting firm. As many deals are taking longer timelines, Q4 2022 and Q1 2023 should see large announcements on the deals under closure. Investors are cautiously observing the intensifying inflationary pressures that are threatening the nascent economic recovery across the world.
Global economy is experiencing an overall slowdown owing to the impact of the Russia-Ukraine war, tightening monetary conditions globally and lingering effects of the pandemic, the London-based firm report revealed. Data suggested that Commercial office assets continued to remain the frontrunner during Q3 2022, garnering about half (47%) of the investment pie. All the quarterly investment came from foreign institutional investors and was concentrated in core office assets in Mumbai. Mumbai attracted the majority of investments during Q3 2022, garnering about 73 percent share in the investment pie while the remaining investments were concentrated in Chennai.

While Mumbai attracted investments in office and data centre assets, Chennai’s preferred sectors were residential, industrial and data centre assets, the report stated. “Asset classes such as office, life sciences, data centres, and industrial are witnessing consistent interest and investment inflows. Allocations to the residential sector are also showing green shoots on the back of strong demand and sales. ESG compliance and social impact projects are being preferred by global investors and LPs. In the short term, there will be an impact of interest rates movement, rupee/dollar position. In a slightly longer term, we will witness new fund managers and investors entering the Indian real estate market which started in 2022.” said Diwakar Rana, Managing Director, Capital Markets, Savills India.