A report released on Wednesday highlighted that from 2019 to 2023, foreign inflows comprised a substantial 77% of all institutional investments in Indian real estate, signifying a strong and ongoing confidence in the sector.
According to insights gathered from real estate consultancy Colliers, the average annual total investment in that span amounted to $5.1 billion (as detailed in the 2024 Investor Insights—Country Spotlight Series’ report). Of this figure, a notable $4 billion stemmed from international sources.
Piyush Gupta, the Managing Director of Colliers India’s Capital Markets & Investment Services, remarked, “Global investors have always remained at the forefront and consistently infused an average of $4 billion annually in the last five years, showcasing continued commitment and confidence towards the sector.” Notably, the office sector attracted the largest share, with an average inflow of $2 billion.
Meanwhile, the alternatives sector was valued at $0.5 billion, while other sectors such as residential, mixed-use, industrial, and logistics each represented $0.4 billion.
The report also stated, “Residential, industrial, and alternative properties are likely to witness renewed interest, even though income-yielding office assets continue to enjoy strong preference.”
The leading investors in Indian real estate are from the United States and Canada, and there is a noticeable increase in interest from Asia-Pacific (APAC) nations, including Singapore, Hong Kong, South Korea, and Japan.
Data from the report indicates that inflows into Indian real estate from APAC countries doubled, reaching $1.8 billion in 2023, up from $0.9 billion in 2019. The region contributed $41.1 billion in 2022 but only 57% of that amount in 2023.
APAC nations have shown a particular interest in residential, industrial, and warehousing assets, with 70% of their investments earmarked for office space in India.
Thanks to robust demand and a conducive business environment, India’s real estate market has “witnessed increased activity” heading into 2024. The report stated, “Security about the policy environment, closing the gap between buyers and sellers, and investor intent to deploy more capital across real estate asset classes are some of the causes why heightened activity is predicted.”