Indian Real Estate Investment Shatters Records, Hits INR 322.8 Billion in First Half of 2024
The Indian real estate market experienced an unprecedented surge in investments, reaching a historic high of INR 322.8 billion in the first half (H1) of 2024. This remarkable growth was primarily fueled by a robust second quarter (Q2), which witnessed a 39% increase in investments, totaling INR 231.5 billion.
According to a comprehensive report by Cushman & Wakefield, Q2 2024 saw massive inflows of capital into the Indian real estate sector. This translates to a 1.5x growth quarter-on-quarter and a substantial 39% increase year-on-year.
Logistics & Industrial Sector Leads the Way
The Logistics & Industrial (L&I) sector emerged as the frontrunner, capturing a commanding 56% share of quarterly investments. This surge in interest propelled the quarterly inflow into the L&I segment to an impressive four times the average of the last 12 quarters.
Foreign investors played a pivotal role in this growth story, contributing 76% of the total investments. Notably, 73% of their funds were channeled towards the L&I sector, with the remaining allocations directed towards the office and residential segments.
Key Trends and Highlights:
H1 2024: Investment flows hit a record INR 322.8 billion, marking an 80% increase compared to the same period last year.
Sectoral Dominance: L&I sector leads with 41% share, followed by office (31%) and residential (26%) sectors.
City Performance: Bengaluru emerges as the top investment destination, accounting for 13% of the total share.
Multi-City Deals: A significant 42% of investments were spread across multiple cities in H1 2024.
Fundraising Outlook: Despite tepid Q2 fundraising, the outlook for H2 2024 looks promising, with major players like Embassy REIT and ASK property fund planning significant capital raises.
InvITs & REITs: Brookfield REIT's acquisition and IndoSpace's planned InvIT listing signal a growing interest in this investment vehicle.
Corporate Transactions: Corporate transactions in real estate also saw a significant uptick, with a 1.9x jump quarter-on-quarter.
Looking Ahead: A Bright Future for Indian Real Estate
The Indian real estate market's exceptional performance in H1 2024 paints a vibrant picture of its future potential. With sustained interest from both domestic and foreign investors, coupled with promising developments in fundraising and investment vehicles, the sector is poised for continued growth and innovation.