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Institutional Investment In Real Estate Drops 73% In Jan-Sep

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Institutional Investment In Real Estate Drops 73% In Jan-Sep
PTI - 03 November 2020

New Delhi, Nov 3: Institutional flow of funds in real estate fell 73 per cent in January-September at $1.18 billion (around Rs 8,700 crore) as investors remained cautious due to the COVID-19 pandemic, according to property consultant JLL India.

However, the institutional investments are likely to rise sharply in the current quarter and the total inflow could reach to $4.8 billion during the entire this year.

Institutional flow of funds include investments by family offices, foreign corporate groups, foreign banks proprietary books, Pension funds, private equity, real estate fund-cum-developer and sovereign wealth fund. It does not include Real Estate Investment Trusts investments.

According to the report, Indian real estate investments stood at $235 million in July-September period as against $155 million during the second quarter of 2020 and 791 million in the first quarter of this year.

Out of 1,180 million inflows till September this year, the office segment contributed 771 million.

"Indian real estate is likely to register $4.8 billion institutional flow of funds in 2020 despite pandemic, just 8 per cent lower than 2019 levels," the report said.

Two landmark portfolio transactions amounting to a total of $3.6 billion in investment value are likely to be concluded in the fourth quarter of 2020.

"The office space market remains to be a sweet spot in the Indian real estate landscape," JLL India said.

"Office assets have been favoured globally due to the yield play and decline in interest rates. Office space investment appetite remained intact during the pandemic and was the first to bounce back during the partial relaxation of lockdown," it added.

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