News: Foreign investment in Indian real estate jumps to $23.9 billion during 2017-21: Report-07-03-2022
The share of foreign investments in Indian real estate has grown to 82% during 2017-2021, compared to 37% in the preceding five-year period.
During 2017-21, the foreign capital flows in Indian real estate jumped 3X times to USD 24 billion compared to the preceding five-year period, according to a recent report by Colliers in association with FICCI.
Over the last five years, global investors have shown an increased inclination towards investment in Indian real estate buoyed by regulatory reforms introduced in 2016. Foreign investors, who had previously refrained from investing in the Indian real estate market due to the lack of transparency, started investing in the country with greater optimism from 2017. The share of foreign investments in Indian real estate has grown to 82% during 2017-2021, compared to 37% in the preceding five-year period. "The investors continue to invest with developers with proven expertise in respective business areas to build and acquire long-term sustainable assets. With residential sales continuing to do well across markets in India and available opportunities to grow for developers, more structured Capital is likely to flow into the sector," said Piyush Gupta, managing director, Capital Markets and Investment Services, Colliers India. During 2017-21, the Office sector holds the frontline of foreign investments with 43% share in total foreign investments followed by mixed-use sector accounting for 18% share in total foreign investments, the report added.
Foreign investments in the office sector have consistently reached USD2.0 bn in each year since 2017 except in 2021, where the quantum of investments almost halved. Foreign investors remained cautious about the residential sector in the aftermath of the NBFC crisis and subdued residential sales. The share of residential assets in total foreign investments has reduced to 11% in 2017-2021, from 37% in a preceding five-year period. The share of investments from the USA and Canada together has been more than 60% in foreign investments each of the years since 2017. Despite the challenges posed by the pandemic, the funds from USA and Canada continue to actively explore the industrial segment, apart from the office and mixed-use assets, according to the report.
