For the quarter ended December 31, 2025, revenue rose 21% year-on-year to ₹11,787 million, while Net Operating Income (NOI) increased 19% YoY to ₹10,407 million. The REIT also declared robust distributions of ₹6,953 million, translating to ₹1.57 per unit.

Leasing Momentum Remains Strong

KRT continued to see healthy demand across its portfolio during Q3 FY26, leasing 0.6 million square feet during the quarter. This took cumulative leasing for the first nine months of FY26 to 2.4 million square feet, underscoring consistent occupier interest.

Portfolio occupancy stood at 92%, supported by a strong leasing pipeline that management says reinforces confidence in sustained business momentum.

A notable trend during the year has been expansion by existing tenants, which accounted for over half of year-to-date leasing. This reflects strong tenant satisfaction and long-term relationships across KRT’s Grade-A office assets.

The REIT has also maintained a disciplined focus on rental growth, with over 90% of YTD leasing carrying built-in annual escalations, strengthening future income visibility. Additionally, KRT reported an embedded mark-to-market potential of 22%, supported by a well-phased lease expiry profile.

Improving Balance Sheet and Cost of Debt

On the financial front, Knowledge Realty Trust continued to strengthen its balance sheet:

• Average cost of debt reduced by ~19 basis points, from 7.44% in September 2025 to 7.25% in December 2025
• Reduction driven by repayment of high-cost debt and benefit from repo rate cuts
• Loan-to-Value (LTV) remains low at 18%, providing significant headroom for future inorganic growth

The REIT’s conservative leverage and improving funding costs position it well amid evolving interest rate conditions.

Growing Global Recognition and Investor Base

December 2025 marked an important milestone for KRT, as it was included in the FTSE EPRA Nareit Global REITs Index, enhancing its global visibility among institutional investors.

The REIT also reported broadening participation across investor categories, with its unitholder base doubling since listing, signalling rising confidence in India’s office REIT story.

Management Commentary

Commenting on the results, Shirish Godbole, Chief Executive Officer, said the trust delivered strong operating performance and healthy distributions during the quarter.

He highlighted the inclusion in the FTSE EPRA Nareit index as a sign of growing global recognition and noted that KRT enters the final quarter of FY26 with strong momentum, a resilient balance sheet, and visible growth levers.

Quaiser Parvez, Chief Operating Officer, said leasing during Q3 was driven largely by expansions from marquee tenants, resulting in strong revenue growth. He added that cumulative leasing of 2.4 million square feet at an average spread of 25% reflects robust demand from both global and domestic occupiers.

According to management, KRT’s portfolio—concentrated in India’s strongest office markets—positions the REIT well to deliver sustainable long-term growth for unitholders.

Investor Interaction

Knowledge Realty Trust has released its detailed earnings presentation and related investor materials on its website. The REIT is also hosting an investor conference call on February 5, 2026, to discuss Q3 FY26 performance, with a replay to be made available subsequently.

Also Read: Knowledge Realty Trust Reports 20% Rise in NOI, Declares ₹6,900 Million Distribution in Q2 FY26

The post Knowledge Realty Trust Posts Strong Q3 FY26 Results; Revenue Jumps 21%, Distributions at ₹6,953 Million appeared first on Square Feat India.

The quarter also saw gross leasing of approximately 0.8 million sq. ft., reflecting sustained demand for high-quality office spaces across Mindspace’s portfolio.

Strong Leasing and High Occupancy

Mindspace REIT maintained a committed occupancy of around 93.8%, which increases to 94.6% on a like-to-like basis, excluding the newly acquired Q-City (now rebranded as The Square 110 Financial District).

The REIT achieved a re-leasing spread of about 28%, indicating robust rental growth, particularly in Hyderabad’s Madhapur micro market. Mindspace also signed its first deal in Madhapur at approximately ₹100 per sq. ft. per month, underscoring the potential for further rental upside.

“With a robust balance sheet, low leverage, and declining cost of debt, we remain well positioned to deploy capital in our development pipeline and capitalize on the strong demand for Grade-A office spaces,” said Ramesh Nair, CEO & MD, Mindspace REIT.

Financial Performance: Revenue, NOI, and Distribution Up

For Q2 FY26, Mindspace REIT’s:

• Revenue from operations stood at ₹778 crore (up 24.8% YoY).
• Net Operating Income (NOI) stood at ₹634 crore (up 25.8% YoY).
• Distribution to unitholders increased by 16.3% YoY to ₹355 crore.
• Distribution per unit (DPU) grew 13.2% YoY to ₹5.83 per unit.

On a half-yearly basis, NOI for H1 FY26 rose by 25% YoY to around ₹1,250 crore. The record date for Q2 distribution is November 8, 2025, and payments will be made on or before November 14, 2025. Since its listing, the REIT has cumulatively distributed about ₹5,950 crore, translating to approximately ₹99.9 per unit.

Portfolio Value and Balance Sheet Strength

As of September 30, 2025, Mindspace REIT’s Gross Asset Value (GAV) rose to ₹41,020 crore, up from ₹36,647 crore in March 2025. The Net Asset Value (NAV) per unit stood at ₹483.7.

The REIT maintained a conservative Loan-to-Value (LTV) ratio of about 24.2%, reflecting strong financial stability. Its cost of debt further reduced by 32 basis points sequentially to 7.52% per annum, aided by refinancing and recent rate cuts.

Mindspace raised ₹1,700 crore through Commercial Papers at an effective rate of 6.12%, and ₹1,150 crore through Non-Convertible Debentures (NCDs) at 7.12%.

Sustainability and Global Recognition

Mindspace REIT continued to earn international recognition for its sustainability initiatives. For the third consecutive year, it achieved a 5-star GRESB rating and was named ‘Global Listed Sector Leader – Office Development Benchmark’.

Its Development Benchmark scored 100/100, ranking 2nd among 18 peers in Asia, while the Standing Investment Benchmark scored 93/100, also ranking 2nd among 20 peers in Asia.

Development Pipeline and Outlook

Mindspace REIT is actively progressing on an under-construction pipeline of approximately 3.7 million sq. ft., positioning it to capture future demand in India’s premium office markets. With low leverage and stable occupancy, the REIT remains optimistic about sustained growth in rentals and portfolio expansion.

The company believes the strong absorption trends across Hyderabad and Navi Mumbai will continue to drive performance in the coming quarters.

Also Read: Data Benchmarking Institutions Launched to Empower Indian REIT Investors

The post Mindspace Business Parks REIT Reports 25.8% YoY NOI Growth in Q2 FY26; Leasing Momentum Remains Strong appeared first on Square Feat India.

Despite a small quarterly dip of just 2%, institutional investments in Indian real estate reached USD 1.76 billion in Q3 2025, the highest third-quarter inflow in four years. This marks an impressive 83% increase compared to last year, a sign of growing investor confidence in India’s property market.

Indian Money Keeps the Market Moving

While foreign capital flows have slowed down, Indian institutional investors and co-investments (where domestic and foreign players jointly fund projects) have surged sharply.

• The share of domestic investments rose to 51% in Q3 2025, a jump of 115% year-on-year.
• Co-investments now account for 41% of total inflows, up from just 15% a quarter ago.
• Foreign investment, on the other hand, dropped to a yearly low of 8%, compared to 46% in Q3 2024.

Experts say this reflects a power shift in who funds India’s growth story. “While foreign investors are cautious amid global headwinds, the rise in domestic and co-investments shows how confident Indian investors are about real estate’s long-term potential,” said Shrinivas Rao, CEO of Vestian.

Commercial Real Estate Leads the Way

The commercial property segment—which includes offices, retail, co-working, and hospitality—remains the biggest magnet for investors, commanding 79% of total institutional inflows.
Investments in this segment rose 104% year-on-year to nearly USD 1.4 billion, underscoring India’s position as a stable hub for corporate leasing and global capability centers (GCCs).

Developers focusing on Grade A office spaces, flexible workspaces, and retail centers are expected to benefit most from this trend.

Residential Investments Ease, But Demand Stays Strong

The residential sector saw a short-term dip, attracting USD 192 million, or 11% of total investments, down from 21% in the previous quarter. However, this still marks a 6% annual rise—showing that while investors are more selective, they remain optimistic about housing demand.

For homebuyers, this means developers are likely to maintain construction pace, backed by stable domestic funding rather than foreign capital. Affordable and mid-income projects, which rely less on offshore money, will continue to progress steadily.

Warehousing and Industrial Sector Gathers Steam

Institutional investment in industrial and warehousing rose 168% over the previous quarter, reaching USD 85.8 million.
The demand for logistics parks and storage infrastructure is being driven by e-commerce growth and manufacturing expansion under Make-in-India, giving investors a new growth story beyond offices and housing.

What This Means for Homebuyers and Developers

1. No slowdown in project funding:
   With Indian investors filling the gap left by foreign funds, developers can continue to raise capital for ongoing and new projects.
2. Stable housing prices likely:
   Since money flow remains steady, property prices are expected to stay stable rather than surge due to financing shortages.
3. Domestic confidence growing:
   More Indian institutions backing real estate reflects long-term trust in the market’s fundamentals — a reassuring sign for homebuyers.
4. More regional and mid-size developers to benefit:
   Domestic capital often looks for diversified opportunities, which could help mid-tier builders in Tier 2 and Tier 3 cities secure financing more easily.

Expert View

“Indian investors are showing tremendous confidence in domestic real estate,” said Shrinivas Rao, FRICS, CEO, Vestian.
“Even as global uncertainty makes foreign funds cautious, the strong participation of Indian capital ensures liquidity, stability, and continued growth across asset classes.”

The Bottom Line

While global uncertainty has made foreign investors cautious, India’s real estate story is now powered by local confidence.
For homebuyers, this means project deliveries will stay on track and the market will continue evolving with more Indian money driving development — a healthy sign of self-reliance and sectoral maturity.

The post 🏠 Why Homebuyers Shouldn’t Worry Even as Foreign Investors Exit Indian Property Market appeared first on Square Feat India.

This shift isn’t just about big funds—it has direct implications for homebuyers, office workers, and urban growth.

Domestic Investors Step Up as Foreign Capital Eases

Foreign investments into Indian real estate have dipped 36% year-on-year to USD 2.1 billion, reflecting global caution amid geopolitical tensions and tighter cross-border capital rules. In contrast, domestic institutional capital has surged 52% YoY to USD 2.2 billion, signaling stronger local confidence.

This growing domestic participation means more consistent funding for housing projects, potentially improving construction timelines and reducing the risk of stalled projects—an issue that has historically troubled homebuyers.

“Institutional investments in Indian real estate touched USD 1.3 billion in Q3 2025 —an 11% increase year-on-year. Domestic capital contributed 60% of the quarterly inflows, with strong interest in office and residential segments,” said Badal Yagnik, CEO, Colliers India.

Office & Residential Segments Lead — What It Means for Urban Residents

The office segment continues to dominate institutional interest with USD 1.5 billion, making up 35% of total inflows so far this year. Residential real estate follows with USD 1.1 billion, up 11% YoY.

For urban professionals, especially in metro cities, this means steady supply of Grade A office spaces, often linked to new job opportunities in tech, BFSI, and emerging sectors. Meanwhile, increased capital flow into residential projects can boost housing supply, stabilizing prices in some micro-markets over the medium term.

“After a relatively subdued first half, institutional investments in India’s office segment rebounded strongly in Q3 2025, rising 27% year-on-year to USD 0.8 billion. Office assets accounted for over 60% of total quarterly inflows, led by notable acquisitions of ready commercial properties, particularly in Chennai and Pune,” said Vimal Nadar, National Director & Head of Research, Colliers India.

Mumbai & Bengaluru Lead, Tier II Cities Emerge

Mumbai and Bengaluru together accounted for one-third of all real estate investments this year, attracting USD 0.8 billion and USD 0.5 billion respectively. Pune saw a dramatic 25-fold increase in Q3 inflows, signaling rising investor interest in non-metro markets as well.

For end-users and small investors, this means new real estate hotspots may emerge outside traditional metros, potentially offering more affordable housing and job clusters in the coming years.

Why This Matters to the Common Man

• Homebuyers: More domestic funding can mean better project completion rates and new housing supply in both metros and smaller cities.
• Job Seekers: Increased office investments point to expanding business activity, particularly in IT and services, which often translates to new hiring.
• Small Investors: Institutional capital flow often signals market confidence, making it a useful macro indicator for long-term investment decisions.
• City Residents: Rising real estate investment in Tier II cities can lead to better infrastructure, transit, and new business hubs.

Also Read: 625 Day Delay Costs Homebuyers Their Appeal

The post Indian Realty Attracts $4.3 Billion in 2025 — Domestic Investors Take the Lead as Global Capital Cools appeared first on Square Feat India.

The Nifty Realty Index was trading with gains, outpacing several other sectoral indices on the NSE. The uptick follows a stable market opening and optimistic sentiment across midcap and sectoral baskets.

 Top Realty Gainers (Morning Trade)

Source: Exchange data

Market participants attributed the sector’s momentum to strong demand trends in the luxury and upper mid-income housing segments, along with expectations of a supportive monetary policy stance in the upcoming review.

 Luxury Housing Demand Anchors Sentiment

Brokerages remain bullish on the real estate cycle, particularly driven by robust sales in the luxury housing segment. According to Elara Securities, luxury demand has emerged as a structural driver, anchoring momentum in the residential real estate market across India. Analysts believe this trend is likely to continue through FY26, boosting developers’ toplines and sector valuations.

“The luxury segment is no longer a niche play — it’s driving volumes and margins for listed developers. With limited inventory and rising premium launches, the pricing power is shifting back to builders,” said an Elara Securities note.

 Policy Signals & Capital Flows in Focus

Investors are also closely watching the monetary policy stance, with hopes that any indication of rate cuts or liquidity measures could further support real estate stocks, which are sensitive to interest rate movements.

In parallel, institutional capital continues to find its way into the sector. EAAA India Alternatives recently announced plans to quadruple its real estate asset portfolio, reflecting growing investor confidence in India’s property market fundamentals.

Additionally, Runwal Realty’s ₹2,000-crore IPO is expected to hit the market soon, potentially drawing fresh capital inflows and increasing public participation in real estate equities.

 Outlook

With festive season sales expected to pick up momentum, analysts expect the realty index to stay in focus over the coming weeks. Key triggers to watch will include policy announcements, Q2 earnings from major developers, and progress on upcoming listings.

While valuations remain elevated compared to long-term averages, many brokerages continue to recommend selective accumulation in quality realty names with strong balance sheets and robust pre-sales pipelines.

Also Read: Qubit’s Navigo Facilitates ₹510 Crore in Real Estate Sales

The post 🏢 Realty Stocks Open Strong as Market Eyes Policy Cues, Luxury Demand Remains Robust appeared first on Square Feat India.

Despite a relatively late start with its first listing in 2019, the Indian REIT market has demonstrated strong fundamentals. “Indian REITs are late to the party, but now lead the dance,” said Shobhit Agarwal, CEO of ANAROCK Capital. He noted that the average distribution yields are competitive with fixed-income instruments but offer the additional benefit of potential capital appreciation.

Currently, Indian REITs account for just 20% of institutional real estate, significantly lower than the penetration in the US (96%), Singapore (55%), and Japan (51%). This is largely due to the sector’s concentration in Grade A commercial office assets. The report highlights significant untapped potential, noting that out of a total 520 million sq. ft. of REIT-worthy office stock in India’s top seven cities, only 32% (166 million sq. ft.) is currently listed.

The future growth of the sector is expected to be driven by diversification into new asset classes. “Over 60% of India’s REIT market value today rests with very small set of players,” stated Mr. Shekhar Patel, President of CREDAI, adding that REITs will eventually expand into retail, logistics, housing, and other new-age assets. The report predicts that as the market matures, India’s REIT penetration could reach 25–30% of institutional real estate by 2030.

A key growth area is industrial and data centre REITs, mirroring a global trend. Globally, data centre REITs were valued at around USD 250 billion in 2024 and are projected to double within seven years. India is showing strong indicators in this direction, with a 60% year-over-year surge in industrial and logistics leasing in the first half of 2025 and a threefold increase in institutional investment in the sector to USD 2.5 billion in 2024.

The proactive regulatory environment, shaped by SEBI since 2014, has been crucial in building investor confidence. Progressive reforms, including reduced lot sizes and dividend tax exemptions introduced in 2025, have enhanced transparency and retail participation. However, the report notes that dividend taxation rates in markets like the USA and Singapore are lower, making them more attractive for retail investors compared to India.

Overall, the Indian REIT market is on a strong growth trajectory, supported by deep office market demand and a stable regulatory framework, making it a compelling investment avenue for both domestic and global investors.

Also Read: Data Benchmarking Institutions Launched to Empower Indian REIT Investors

The post Indian REITs Deliver 6-7% Yields, Outperforming Global Peers; Market Cap to Hit $25 Bn by 2030 appeared first on Square Feat India.

·       Domestic investments rose 66% YoY in 2023; led by residential and alternatives

·       Office continued to drive capital inflows with a commanding 56% share in 2023

·       Industrial & warehousing saw 2x investments compared to 2022

Institutional investments in Indian real estate sector maintained a steady momentum at USD5.4 billion, rising 10% YoY during 2023. The year witnessed highest levels of investment inflows since 2020 showcasing India’s resilience despite uncertainties in global markets otherwise. While foreign investments retained their dominance, forming 67% of the total inflows for the year, domestic investments also registered an impressive 66% annual increase at USD1.7 billion. Office sector continued to be the largest contributor in real estate investments for 2023 with 56% share in total inflows, attracting both global as well as domestic capital. While the overall investment inflows during the year remained sturdy, the last quarter of the year saw moderation. At USD0.8 billion, Q4 registered a 37% YoY drop in investments. Alternatives, meanwhile, had a 51% share in total inflows during Q4 2023, indicating strong demand in segments including data centres, student housing, life sciences, schools, etc.

While key global investment markets faced downside risks, India maintained its status being amongst the fastest-growing economies keeping investor confidence intact. While inflows from the US have witnessed a drop in 2023 as compared to 2020 levels, Canada and Singapore are increasingly establishing themselves as leading source of foreign capital in Indian real estate. These two countries accounted for 78% of the global real estate inflows into India during 2023. Noteworthily, investment inflows from APAC countries have been rising every year and have surged to 3.6X times in 2023, compared to 2020. Investors continue to view India favourably, owing to strong economic performance, improved regulatory framework, and sustained demand across various real estate segments.

“As India’s real estate sector closes yet another promising year, institutional investments saw an increase of 10% and stands at USD 5.4 billion—the highest since 2020. The investments in Indian real estate are more broad-based, with significant investments coming into education, shared spaces, and data centers, adding to a strong domestic upcycle in office, residential, and industrial areas. Investors from the APAC region have been showing an increasing appetite for Indian real estate, contributing to about half of the total foreign inflows during 2023. Looking ahead to 2024, investment activity is likely to remain unabated backed by robust domestic economic fundamentals, while a strategic integration of technology and ESG will play out in investment decisions.” said Piyush Gupta, Managing Director, Capital Markets & Investment Services at Colliers India.

Domestic capital inflow surged 66% YoY during 2023

Domestic investors have emerged as active contributors, contributing 32% of the total real estate investments in 2023, compared to 22% share in 2022. While office market continues to be the frontrunner backed by investments from global players, domestic investors are focusing more on alternative and residential assets.

Office sector continues to be the frontrunner; investments in alternatives rebound significantly

At USD3.0 billion, investment inflows in the office sector rose 53% YoY during 2023, led by select large deals. The uptick reflects a rising interest in completed and pre-leased income-yielding office assets, showcasing investors’ sustained confidence in the long term potential of the sector. Notably, investors are actively establishing Joint Venture (JV) platforms to capitalize on emerging opportunities and participate in both existing and upcoming office projects. 2023 saw some significant platforms being established for development of office as well as residential assets.

“In the ever-evolving tapestry of India’s real estate landscape, while investors continue to diversify portfolios, the office sector continues to enjoy significant affinity. Fuelled by strong demand for Grade A commercial developments, investments in office sector continue to grow from strength to strength. As 2023 witnessed record breaking office space leasing activity, global institutional investors remained committed on building office portfolios in India. Office led investments had a commanding 56% share in total real estate inflows in 2023. Along with envisaged momentum in alternative assets, industrial & warehousing, and residential sectors in the next few quarters, office sector will continue to dictate India’s real estate investment ecosystem.” said Vimal Nadar, Senior Director and Head of Research, Colliers India.

Investment inflows (USD million) –

*Note: Alternate assets include data centres, life sciences, senior housing, holiday homes, student housing, schools etc

Source: Colliers

Industrial & warehousing surged 2x times in 2023

Industrial & warehousing segment saw a noteworthy two-fold rise with about USD0.9 billion inflows, marking the highest increase across all segments in 2023. This exceptional growth is credited to the sustained expansion of industrial sector, thriving on heightened consumption levels. As the sector evolves, we are likely to witness increased consolidation as well as institutionalisation in the sector. With micro-fulfilment centres, dark stores and AI driven supply chain becoming an integral part of industrial & warehousing segment, foreign investments in the sector are expected to rise multi-fold in the next few years.

Investments in Alternatives bounced back in the last quarter

After witnessing subdued activity in the first 3 quarters, investments in alternatives rebounded in the last quarter, taking the overall inflows in alternatives to USD650 million for the year. Q4 2023 accounted for 65% of the total investments in alternatives in 2023. Student housing accounted for about 60% of the investment inflows within alternatives during the year. Rising institutional interest has been driven by the surge in higher education enrolment, favourable demographic distribution pattern, and growing migration of students to cities. This trend reflects a constant recalibration of investor and developer interests which aligns with students’ preference for quality, and purpose-built accommodation.

Institutional investments in Indian real estate 2023

Asset class-wise investment inflows in Q4 2023 in USD million

Source: Colliers

Note: The institutional flow of funds includes investments by family offices, foreign corporate groups, foreign banks, proprietary books, pension funds, private equity, real estate fund-cum-developers, foreign-funded NBFCs and sovereign wealth funds. The data has been compiled as per available information in the public domain

Note: Alternate assets include data centres, life sciences, senior housing, holiday homes, student housing, schools, etc

City-wise investment inflows in 2023 and 2022 in USD million –

Source: Colliers

Note: The institutional flow of funds includes investments by family offices, foreign corporate groups, foreign banks, proprietary books, pension funds, private equity, real estate fund-cum-developers, foreign-funded NBFCs and sovereign wealth funds. The data has been compiled as per available information in the public domain

Note: Alternate assets include data centres, life sciences, senior housing, holiday homes, student housing, schools etc

Top Deals

Select key deals 2023

Source: Colliers

Note: The institutional flow of funds includes investments by family offices, foreign corporate groups, foreign banks, proprietary books, pension funds, private equity, real estate fund-cum-developers, foreign-funded NBFCs and sovereign wealth funds. The data has been compiled as per available information in the public domain

Note: Alternate assets include data centres, life sciences, senior housing, holiday homes, student housing, schools etc

Select key deals Q4 2023

Source: Colliers

Note: The institutional flow of funds includes investments by family offices, foreign corporate groups, foreign banks, proprietary books, pension funds, private equity, real estate fund-cum-developers, foreign-funded NBFCs and sovereign wealth funds. The data has been compiled as per available information in the public domain

Note: Alternate assets include data centres, life sciences, senior housing, holiday homes, student housing, schools etc

Top platform deals 2023

Source: Colliers

Also Read: Office sector sees robust demand with projected net absorption of 37-39 mn sq ft in 2023

The post Institutional investments in Indian real estate maintain steady momentum at USD5.4 Bn; inching towards pre-pandemic levels appeared first on Square Feat India.

·       Office sector continued to dominate at 63% share in total inflows

·       Industrial & warehousing and residential sector witnessed a 3.5X and 2.6X YoY rise, respectively

Institutional investments in Indian real estate touched USD4.6 bn during January-September 2023, a 27% YoY increase, highlighting the resilience and attractiveness of the market despite prevailing global challenges. It is worth noting that institutional investment inflows for 2023 have already reached 93% of the total inflows recorded in 2022, despite a clouded  global economic environment. While foreign investments continued to lead with 77% share in total investments, domestic investments remained strong and witnessed a two-fold rise YoY at USD1.1Bn. Interestingly, domestic investments  led  investment activity in Q3 2023, forming  63% of the total investments, abutting  the overall investment volume at USD0.8Bn for the quarter. While office assets saw  moderation in inflows during the quarter, residential and industrial & warehousing segments witnessed a rebound accounting for about 78% of the total investment volume. India’s sturdy economic growth, and a continued strong positive play of high-performance economic & market indicators are keeping the long-term confidence high amongst global & domestic investors.

Top 5 PE investment deals in YTD 2023 –

Source: Colliers

Top 3 PE investment deals in Q3 2023

Source: Colliers

Office sector continues to lead; Residential and Industrial and warehousing see traction

Investment inflows in the office sector rose 1.6X YoY during Jan-September 2023, at USD2.9 billion, led by select large deals in the sector. This robust performance underscores the sustained confidence of investors in the sector’s growth potential and returns. There is an increased investor interest towards completed and/or preleased income yielding office assets, reflecting a conscious & cautious shift in investor strategies. Investors are actively forming large Joint Venture (JV) platforms to capitalize on emerging opportunities and participate in existing as well as upcoming office projects. While investors remain commited to office asset class during 2023, industrial & warehousing and residential sectors also saw a significant rebound.

“At a time when major global economies are weighed down by inflation woes, rising cost of capital and growth uncertainty, India’s real estate market stands strong, by navigating through difficult market conditions. The resilience of the market can be gauged in terms of heightened deal activity and amount of capital allocated across diverse asset classes. During the first nine months ended September 2023, overall institutional investments stood strong at USD4.6Bn, a 27% YoY rise, steered by long-term confidence in the region and avenues for diversification. While some volatility and uncertainty will remain in the short-term, the industry is well positioned for a robust 2023 and beyond,” said Piyush Gupta, Managing Director, Capital Markets & Investment Services at Colliers India.

Investments inflows (USD mn) –

*Note: Alternate assets include data centres, life sciences, senior housing, holiday homes, student housing etc

YTD refers to the Jan-Sep period of the year

Source: Colliers

City-wise investment inflows in Indian real estate (USD million)

Source: Colliers

Domestic investors gain further ground with 1.7X rise in inflows during Jan-September 2023

Domestic investors have become more active in the market, contributing 23% of the total investments during this period, compared to an 18% share in the same period in 2022, infusing majority of the funds into residential sector. Nonetheless, foreign investments maintained their lead during Jan-Sep 2023, accounting for a 77% share of total investments with USD3.5 billion inflows. This was a 47% YoY surge compared to same period last year.

“The Indian real estate sector continues to demonstrate its allure as a resilient and promising investment destination, with both domestic and international investors showing relentless commitment to participate in its high growth phase. Investment inflows by domestic investors are specifically on the rise and have seen about 70% YoY rise during Jan-Sep 2023. About half of the total investments by domestic investors was directed towards residential assets during the period. This renewed interest in residential assets backed by stable interest rates is expected to drive heightened activity during the upcoming festive season; resonating upbeat confidence amongst investors, developers & homebuyers alike.” said Vimal Nadar, Senior Director and Head of Research, Colliers India.

Investments in industrial & warehousing sector witnessed 3.5X rise YoY

Investment inflows into industrial assets have surged by a stirring 3.5 times, at USD690.6 million during Jan-September 2023. This remarkable growth can be attributed to the sustained expansion of the industrial sector, which has thrived on the surging consumption levels. India’s bolstering manufacturing sector has been a prominent driver of this growth, advancing at an impressive pace owing to robust demand and increased industrial output. Key indicators such as Index of Industrial production (IIP) in India increased 5.7% year-on year in July 2023 while India’s Manufacturing Purchasing Managers’ Index (PMI) rose 4% YoY at 57.5 in September 2023, signalling strong demand conditions and enhanced business sentiments within the manufacturing sector. Upturn in domestic consumption trends, rising demand from 3PL players indicate an attractive investment scenario in the foreseeable future.

Also Read: Financial Institutions To Redevelop Stuck SRA projects

The post Institutional investments in real estate rise 27% YoY at USD4.6Bn during Jan-Sep 2023; domestic investments up 1.7X appeared first on Square Feat India.

The office sector has seen a healthy recovery since late last year with occupiers leasing large spaces as now offices are seen as a place for collaboration. Institutional investors are eyeing greenfield and ready office assets with large portfolios, with a view to bundle them up as REITs in the future. Investments into the office sector rose 53% YoY during the first three quarters of 2022.

“The capital in Indian Real Estate is getting more broad-based with active participation also from domestic institutional and retail Investors. Domestic capital is seen to flow across asset acquisitions, with credit in multiple asset classes with varied pooled structures. The sentiment of global investment firms to invest in India remains strong in spite of global slowdown trends. The current state of economics, with respect to inflation and interest rates, is not perceived to have a long-term impact.” said Piyush Gupta, Managing Director, Capital Markets and Investment Services, Colliers India.

Domestic investors have become more active in the market, with their investment inflows accounting for 18% share, compared to 14% share during the same period last year. However, global investors continue to dominate funding activity with higher participation in entity-led deals.

India Investments inflows

Multi-city deals form a chunk of inflows

Multi-city deals continue to be on the rise, with a 45% share in investments during YTD 2022. Majority of the deals were entity-led for office assets as investors lap up investment-grade office portfolio. During January-September 2022, Delhi-NCR saw the highest share of inflows at 21%, followed by Mumbai and Bengaluru.

Platforms deals signalling investor confidence in asset development

The year 2022 has seen several platform deals between institutional investors and developers for specific sectors. Industrial and logistics assets are high on investors’ radar with several platforms being formed for the development of assets in this space.

“With global investors partnering with local developers, there is ample dry powder to be invested in the Indian real estate market, especially in the office, and the industrial sectors. Over the next few quarters, while there may be some slowdown in deployment of funds due to the recession, we believe that the Indian market is relatively well-insulated and investors continue to view it favourably,” Vimal Nadar, Senior Director and Head of Research, Colliers India.

Also Read: Real Estate PE Investments Log 40% Annual Rise in 1H FY23

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