Singapore-Based Firms Lead Private Equity Investment In India’s Real Estate: Report

After establishing a strong base in China, India seems to the next top-favorite destination of Singapore-based private equity investors. As per a recent report, about one-third of the total $14.01 billion private equity investment in India’s real estate sector in 2015-18 was made by Singaporean firms.

Riding high on the wave of optimism, Singapore-based firms have reportedly pumped $1.15 billion into Indian realty in 2015 and 2016, and nearly $3.5 billion in 2017 and 2018. Clearly, there was a three-fold jump in 2017 and 2018.

Major investments are going to South Indian cities with firms such as GIC, Ascendas-Singbridge, and Xander taking the lead to funnel billions of dollars into the Indian real estate industry. Owing to the heavy investment, Singapore has understandably gained a strong foothold in the Indian real estate segment over the last four years, especially in South Indian cities.

Like, in the past four years, GIC has invested close to $2.5 billion, mainly in cities such as Mumbai, Chennai, Bangalore, Hyderabad, and NCR, ANAROCK said in a report, Live Mint reported. On the other hand, Ascendas has evidently preferred regions of Hyderabad, Chennai and Mumbai Metropolitan Region for the investments.

Over the last couple of years, Singapore-based private equity players not only have scaled up their investment manifold, but are also diversifying their portfolios and eyeing sunshine sectors like logistics and warehousing apart from commercial spaces including office and retail.

The main reason for the rise in the trust of Singapore players is cited as their more patient and long-term outlook.

“With funding from banks and non-banking financial companies drying up, Indian developers are being forced to explore debt and equity funding from various PE firms. Singapore investors were on top of the list, followed by PE players from US and Canada. After establishing a strong base in China, India was their next destination of preference,” the publication quoted said Shobhit Agarwal, managing director, and chief executive officer at ANAROCK Capital, as saying.

Singapore players are closely followed by US-based investors such as Blackstone, Goldman Sachs, Hines, Warburg Pincus, and Proprium Capital have invested nearly $4 billion in India in the last four years.

PE firms from Canada, led by Brookfield and CPPIB, were the third largest investors with a capital infusion of close to $2.3 billion in four years.

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