India Real Estate Insulated Even As Recession Woes May Delay Fund Deployment: Colliers

Indian real estate continues to see institutional investment pouring in even as global recessionary concerns loom, according to Colliers International.

“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,” Vimal Nadar, senior director and head of research at Colliers India, was quoted as saying in a report. “Over the next few quarters, while there may be some slowdown in deployment of funds due to the recession, the Indian market is relatively well-insulated and investors continue to view it favourably.”

Piyush Gupta, managing director-capital markets and investment services at Colliers India, said 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, he said, is not perceived to have a long-term impact.

India’s real estate sector witnessed institutional investments worth $3.6 billion (Rs 29,636 crore) during January-September 2022, up 18% year-on-year, the report said. That was driven by the office sector that accounted 50% share, followed by retail which clocked a few large deals.

The office sector, it said, 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, aiming to bundle them up as REITs, or real estate investment trusts, in the future, the report said.