Knight Frank: Private equity inflow into real estate dips 44% to $3 billion this year.

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    This year, global investors have been a bit careful when it comes to investing in Indian real estate. According to Knight Frank, the amount of private equity invested dropped by 44% to USD 3 billion by December 12 compared to last year’s total of USD 5.4 billion.

    Knight Frank India’s data reveals that between January 1 and December 12 this year, the Indian real estate market received USD 3,024 million in PE investments from 23 deals. This amount was significantly higher in 2022, reaching USD 5,357 million.

    The cautious approach of global investors can be linked to various factors, such as uncertainties in global politics and rising interest rates. Multiple rate hikes by the US Federal Reserve and the Central Bank of Canada have impacted investments from these regions.

    Interestingly, while investments from the US and Canada decreased, PE investments from Singapore showed notable growth, contributing more than 50% to the total inflow.

    Breaking it down by sectors in the Indian real estate market, office assets were the most preferred, capturing 58% of total PE investments. Warehousing followed at 23%, with residential properties at 19%.

    However, the retail sector didn’t witness any PE deals throughout 2023.

    In terms of specific regions, Mumbai attracted the largest chunk of these investments, securing USD 1,685 million (1.6 billion). The National Capital Region followed with USD 835 million, and Bengaluru with USD 347 million.

    This change in investment trends reflects global investors’ careful and considered approach to Indian real estate. It mirrors a landscape influenced by global uncertainties and fluctuating interest rates.

    (Source: ET realty)

    Also read: Kanakapura Road: A Growing Real Estate Destination in Bengaluru

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