India’s real estate sector attracts US$ 26.6 billion in foreign investment over five years: Report

According to a survey by the real estate services company Colliers, foreign institutional inflows into India's real estate market increased by three times, totalling US$ 26.6 billion between 2017-2022. The growth is attributed to structural and policy reforms that have enhanced transparency and ease of doing business in the sector.

The “India-High on Investors Agenda” report focuses on the elements that make India a top choice for international investors and monitors the expansion and recovery of the real estate sector.

Additionally, it looks at opportunities in both traditional and non-traditional asset classes, including data centres and Global Capability Centres (GCCs). About 81% of all real estate investments during the time were made abroad, driven by investor-friendly Foreign Direct Investment (FDI) rules, enhanced deal transparency, and higher investment restrictions. The office sector dominated institutional investments in Q1 of 2023, which increased by 37% year-on-year (y-o-y) to US$ 1.7 billion.

India is a popular place to invest since its real estate market currently offers competitive pricing, better valuations, and greater yields than other cities in the area. Major Indian cities like Mumbai and Bengaluru offer larger yields at more affordable price points.

Recent years have seen considerable inflows into various real estate asset classes, with the office sector accounting for 40% of all inflows between 2017-22. Foreign investments in industrial assets have increased as well, making for 87% of all industrial and warehousing investments during the same time.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.