India property investment soars 66% to USD1.8b in Q4

The office sector dominated investments during the quarter.

According to a report from Cushman and Wakefield, the investment activity recorded in Q4 was INR 149.4 bn (USD 1.79 bn) which was 2.8x times higher than the slower activity witnessed in last quarter and about 66% higher than Q4-22. 

In terms of sector share, office resurfaced as the most preferred asset class after a gap, with the highest share of 49% in quarterly inflows. This was followed by the residential sector with 28% share. Foreign investors’ share in total quarterly inflow stood high at around 73% share, predominantly investing office and residential segments. 

Here’s more from Cushman and Wakefield:

For the entire year 2023, investments clocked in at INR 454.3 bn (USD 5.5 bn), 11% higher than 2022 inflows, indicating a resilient Indian real estate market. Office sector with nearly 46% share continued to dominate in 2023 followed by logistics & industrial (L&I) and residential segments with 15.7% share each. 

In 2023, investments in alternative sectors(hospitality, data centers and L&I) , surged to USD1 billion from below USD 0.5 billion investments witnessed in the previous 5 years, constituting a substantial 9.61% of the total investment landscape. 

Share of foreign investors stood low in 2023 at 67% compared to a muchhigher 85% share in 2022, largely owing to risks emanating from geopolitical tensions. Amongst foreign investors, those from Singapore (26%) and USA (14%) had the highest share. 

Domestic investors, meanwhile, stepped-up their investment share to near-about 26% in 2023, compared to 14% in the previous year. Equity investments contributed to 56% of total investments while debt component was 16% with the remaining coming from REIT.