Equity investments in Indian real estate may rise 49% to record $11 billion this year, says CII-CBRE report

Equity investments in Indian real estate may rise 49% to $11 billion this calendar year amid strong demand for properties, according to CII and CBRE. In the 2023 calendar year, the equity investments in real estate stood at $7.4 billion.

Industry body CII and real estate consultant CBRE on Wednesday released a joint report titled 'Leading the Charge: Crafting the Skylines of Tomorrow' at the annual CII Realty 2024 conclave. Equity capital inflows touched $8.9 billion between January and September, registering a 46% year-on-year growth.

"Overall equity investments in 2024 in the real estate sector are set to hit a new record surpassing $10 billion for the first time," the report said. With a resurgence in investment inflows in built-up office assets and a strong acquisition pipeline for land in the residential sector, the overall equity investments in 2024 would be in the $10-11 billion range.

During January-September, institutional and collective vehicle investors accounted for nearly 40% of the overall investments. Developer companies led the total capital inflows with more than 41% share in this period.

Domestic investors (predominantly developers) invested nearly USD 6 billion during the first nine months of the calendar year, dominating the overall capital inflows with an almost 65% share. In comparison, foreign investors contributed about $3.1 billion during the same timeframe.

Notably, North American and Singaporean investors were the significant contributors, representing about 85% of all foreign capital inflows. Anshuman Magazine, Chairman & CEO, India, South-East Asia, Middle East & Africa, CBRE, said, "Projection for 2024 equity investments between $10-11 billion, highest-ever, underscores continued investor interest in the growing real estate market in India."

With SEBI's SM-REIT framework, he said, smaller but high-quality assets in Tier-II markets would also present new avenues for strategic capital deployment.

"We believe this regulatory support will add much-needed transparency, enabling a more diversified investment base and encouraging institutional participation across these markets," Magazine said.

Going ahead, he said this growing diversification will not only solidify India's real estate sector but also pave the way for future growth across emerging asset classes.