Realty sees surge in investment platforms, partnerships worth $4.5 bn

According to the data, platform deals/partnerships worth $1,651 million were announced in 2019, $1,880 million in 2020 and $3,320 million in the 2021 calendar year

Indian real estate saw a surge in setting up of investment platforms in 2022 and an amount of USD 4.52 billion has been committed, which will be deployed over the next few years, according to JLL India.

Foreign as well as domestic investors tie up with real estate developers to establish an investment platform for the development of different realty projects like warehousing parks, office assets, student housing and data centres among others.

According to the data, platform deals/partnerships worth USD 1,651 million were announced in 2019, USD 1,880 million in 2020 and USD 3,320 million in the 2021 calendar year.

"Platform deals/ partnerships amounting to USD 4,527 million were announced during 2022, to be invested in the next few years," JLL India said in a report, adding that higher investment commitments over the years suggest increasing confidence in the Indian real estate market.

"Improved synergy of marquee global funds with pedigree developers in respective asset classes - an indication of a market moving towards institutionalisation," the consultant observed.

Warehousing took the major share of the pie at 41 per cent, followed by the office sector at 35 per cent.

Since 2017, post the GST legislation, the warehousing sector has seen a significant commitment from platform investments.

Last year, Macrotech Developers, which sells properties under the Lodha brand, announced the setting up of a USD 1 billion investment platform along with two foreign investors for the development of industrial and warehousing parks.

Meanwhile, the property consultant mentioned that institutional investments in real estate rose 19 per cent last year to USD 5,151 million from USD 4,133 million in 2021.

Investors from the US and Canada have been the biggest investors in India.

Office sector continues to be the front-runner for institutional investments, with an inflow of USD 1,860 million last year, up from USD 1,365 million in the previous year.

Residential sector attracted USD 1,564 million investments in 2022 compared to USD 1,081 million in 2021.

There was a "tug-of-war between office and residential sector in 2022. Office sector ahead by a narrow margin at 36 per cent share in the investment pie, followed by residential at 30 per cent share. Investments in residential sector gained momentum post the (Covid-19) pandemic," the report said.

"Within the real estate domain, investors are increasingly looking at newer asset classes like co-living, co-working, student housing and data centres among others," Bengaluru-based co-living startup Settl Co-founder Abhishek Tripathi said.

The trend is likely to gather further pace over the next few years, he added.

According to the property consultant, 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. It also includes anchor investors in REITs (Real Estate Investment Trusts).