Share of domestic investors in real estate market is rising

For the nine month period between January-September 2022, investments in Indian real estate touched US$3.6 billion, registering a hike of 18% y-o-y. Investments in India are getting broader based with increased participation from domestic investors.

Newer avenues are evolving like fractional ownership, alternate investment funds (AIFs), and pooled investment structures are providing depth to both investors and developers. Domestic investors accounted for about 18% of the investments between January-September 2022, rising from 14% share last year.

While global investors continue to dominate funding activity with higher participation in entity-led deals.

Investments in the commercial office sector saw a 53% year-on-year growth. In 2022, office leasing is likely to cross 50 million sq. feet across the top six cities, surpassing the highs seen in 2019. The office leasing activity could remain muted in the fourth quarter (Q4) over apprehensions of a global recession but the adoption of technology in the workspace will drive innovation and demand in the future.

Warehousing and logistics segments too witnessed a buoyant demand and a steady rise in absorption rates. In the residential sector, this was mostly seen due to lower interest rates and the offers during the festive season.