India’s real estate rescued by Private Equity funds of USD 3.8 billion

Amidst the cash crisis in the real estate sector, PE funds are coming ahead to boost it. In the first three quarters of 2018-19, the realty sector has received an investment of over $3.8 billion from private equity funds. This amount shows a 19% boost in the PE investment in the same period a year ago, according to the data of ANAROCK Property Consultants.

The investment came at a time when almost no bank and NBFC is ready to fund the real estate of India. About 95% of the money came in the form of equity investment and the remaining 5% was structural debt.

“Commercial real estate continues to be the hot investment target for private equity investors in 2019 and the trend will most likely continue in the quarters ahead,” said Shobhit Agarwal, MD, and CEO of ANAROCK Capital.

Indian investors don’t see a good run in the realty space, promoting overseas investments. Foreign investors, unlike domestic ones, are reposing their faith in the Indian real estate with enjoying great benefits due to the ongoing liquidity crunch. While foreign PE funds have dominated the investment in the sector, Blackstone, Ascendas, Brookefield, Hines, etc. have emerged as the top investors.

Continuing the trend from the last few years, the residential sector’s PE share has improved this year too as it attracted USD 295 million as compared to USD 210 million last year.

Talking about the regional dominance, Mumbai Metropolitan Region is certainly the winner as it saw USD 1.59 billion of inflow, the maximum in India. The poor show of Delhi NCR’s real estate continues as it fell from USD 150 million last year to USD 115 in 2019 while Bengaluru witnessed USD 490 million of PE funds this year.

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