Capital Inflows Jumps Three-Fold Into Indian Real Estate

Foreign capital flows into Indian real estate jumped over three-fold, according to a FICCI report. Foreign capital flows into Indian real estate jumped over three-fold to $23.9 billion during the 2017-21 period as compared to the previous five years, according to the report.

The report mentioned that the global investors had shown an increased inclination towards investment in Indian real estate buoyed by regulatory reforms introduced in 2016. According to the data, foreign investment in real estate stood at $23.9 billion during the 2017-21 period against $7.5 billion during 2012-2016. Total investments in Indian real estate stood at $49.4 billion during the 2012-2021 period, of which 64 per cent came from foreign investors. The share of foreign investments in Indian real estate has grown to 82 per cent during 2017-2021, compared to 37 per cent in the preceding five-year period. During 2017-21, the office sector had a 43 per cent share in total foreign investments, followed by the mixed-use sector accounting for 18 per cent. The industrial and logistics sector investments stood at third position, surpassing the residential sector. Foreign investors remained cautious about the residential sector in the aftermath of the NBFC crisis and subdued residential sales.

Office space segment expected to expand in 2022

Commercial space segment expected to expand in 2022; as occupiers focus on health and wellness of their employees, demand for well-managed properties with superior infrastructure is projected to increase with Delhi-NCR having the largest share of the pie.

India is one of the fastest growing e-commerce and 3PL markets. The IT industry, which is one of the largest contributors to office space absorption, is expected to grow at 15.5 per cent in 2022.[8] While these trends can have a positive impact on commercial real estate, there are downside risks including an escalation in geopolitics and monetary policy normalisation in advanced countries, which need closer monitoring.

Another area of concern is disallowance of input tax credit during the construction phase, which is pressuring developers in terms of higher construction costs. With multiple factors favouring its growth, commercial real estate is expected to weather these challenges and record a smart recovery.

Logistics firms look to ramp up tier-II, in-city expansion

Top warehousing developers aim to ramp up expansion in tier-II locations and within metros this year for better reach and to fulfil last mile delivery demand led by retail, e-commerce, grocery firms, and third-party logistics providers.

Operators and investors such as ESR, LOGOS, Blackstone-led Horizon Industrial Parks, and Welspun One Logistics Parks (WOLP) are actively eyeing land acquisitions in smaller cities and vying for first mover advantage in setting up multilevel in-city logistics hubs.

ESR, which has 17 operational warehousing sites over 18 million sq. ft across large cities, is in advanced discussions to acquire 3-4 land parcels focusing on tier-II cities. It kicked off its urban logistics plan with the acquisition of 8.2 acres in Alipur, Delhi, to set up a 300,000 sq ft distribution centre to cater to e-commerce, grocery, pharmacy, cloud kitchen, and other companies.

BMC is authorised to crack down on unsafe buildings: Bombay HC

Safety of buildings is paramount, said Bombay high court while holding that BMC, as planning authority for Greater Mumbai, is the competent authority to take action against illegal structures in slum areas.

Brigade Enterprises' sales bookings up 14% Rs 1,995 crore in Apr-Dec 2022

Out of the total sales bookings, the housing segment contributed Rs 1,957.4 crore, up 17 per cent from Rs 1,668.2 crore in the year-ago period. Brigade Enterprises Ltd's sales bookings increased by 14 per cent to Rs 1,994.8 crore in the first nine months of this fiscal, mainly on the back of revival in housing demand.

Indian ultra HNIs allocate 29% of wealth to buy primary, second homes in 2021

Nearly 30 per cent wealth of Indian ultra-high-net-worth individuals (UHNWIs) was allocated towards purchase of principal and second housing properties last year.

Further, 22 percent of UHNWIs' investable wealth was allocated towards direct purchase of commercial property (including rental property, offices etc) while 8 per cent was allocated towards indirect purchase of commercial property (including REITs, funds, etc.).

Maharashtra's revenue from property registrations to hit new high in FY22

Within the first 11 months of FY22, the state has earned Rs 5,671 crore from property registrations, which is 63 per cent higher than Rs 3,474 crore in FY21.

The additional surcharge of 1 per cent on property registrations from April 1, 2022 is making buyers advance their purchases, resulting in higher revenues for the exchequer.

© 2022 National Association of Realtors India. All rights reserved.