Almost half of Pune’s GradeA office stock is owned by institutional investors: Savills India

• Since 2017, PE investors pumped in $1.8 billion in Pune’s realty market.
  
• A large chunk of Grade A stock owned by institutional investors lies in East Pune, but newer locations in West Pune are also becoming popular.
  
• The report predicts that institutional investors are expected to double their portfolio by 2027.
  

Pune’s real estate sector saw an inflow of $194 million in private equity investments in 2022, according to the latest report by Savills India, a global property consulting firm.

Since 2017, PE investors have pumped in $1.8 billion in Pune’s realty market, thanks to opportunities in the office space market. Due to continuous investments, institutional investors now have a strong foothold in the city’s office market.

“The city’s improving infrastructure, including the expansion of highways and the development of industrial parks, have contributed to this growth. Its proximity to India's financial capital, Mumbai, makes it an ideal location for companies to establish their operations,” Praveen Apte, managing director - Pune, Savills India said.

Institutional investors own around 30 million sq. ft. of office space – that’s 45% of Pune’s overall Grade A stock. A large chunk of this stock lies in East Pune, but newer locations in West Pune such as Wakad and Tathawade are becoming popular due to improving infrastructure and increased connectivity.

“Pune’s reputation as an educational and research centre has also led to an influx of students and professionals which in turn provides a ready pool of skilled workforce for companies,” Apte added.

The report predicts that institutional investors are likely to double their portfolio by 2027. It expects them to add another 27 million sq. ft. of office assets to their portfolios.

“Savills expects new institutional investors to enter Pune’s real estate market, while current investors will expand their presence as quality assets grow,” Savills India reported.

The city has many infrastructure projects currently under construction or in the planning stages like — smart city development, Ring Road construction, Bus Rapid Transit System, metro rail, new airport, multiple subways, and flyovers.

In addition to office space, institutional investors also own other commercial assets to the tune of 29 million sq. ft. across retail, hospitality, industrial and warehousing sectors.

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