Indian realty attracts $3.3 billion PE investments, 49% of entire 2020, in Jan-Sept

Private equity investment inflows into the Indian real estate sector stood at $3.3 billion or Rs 23,300 crore during the first nine months of the year until September, equivalent to half of the investment inflows that the sector witnessed in entire 2020.

For the quarter ended September, private equity inflows into the property sector stood at $477 million or Rs 3,500 crore marking a 24% on-year growth and 45% sequential decline, showed a Savills India report.

This temporary slowdown in investment activity can be attributed to delayed decision-making by investors in the face of the pandemic.

“As the vaccination drive has picked up speed, we will see business confidence gaining momentum. Inspite of the pandemic, the year 2021 has continued to witness some marque deals across real estate segments,” said Diwakar Rana, Managing Director, Capital Markets, Savills India.

Among asset classes, data centres garnered the highest share of about 34% in total private equity investments during the quarter. Data centres have proven to be resilient to the impact of the current pandemic in India. With the growing need for digital connectivity leading to a sharp rise in data usage, the demand for data centres, too, has soared.

The quarter also witnessed India’s maiden investment by a global pension fund in life science research & development (R&D) assets where Ivanhoe Cambridge and Lighthouse Canton jointly invested $100 million in life science R&D facilities in Genome Valley, Hyderabad.

The property consultancy expects India to further cement its position in the global life science arena in the post-pandemic world, thereby presenting a lucrative opportunity for private equity investors focusing on life science R&D real estate.

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