 "Nearly $2.2 bn worth property funds raised after 2014 elections")
About $2.2 billion worth of property funds have been raised to invest in Indian real estate after 2014 general elections, said a new study.
During 2005-08,in pre global financial crisis period, there were 50 such funds that raised $16 billion in total and post that, 29 funds were raised, totalling $3.9 billion, said Shobit Agarwal, managing director, Capital Markets at JLL in a note.
"The cycle started gaining momentum again just before the 2014 general elections on the hopes of a Modi-led government coming to power at the Centre. $2.2 billion has been raised so far in the current investment cycle. This shows a definite rise in confidence for Indian real estate," Agarwal said.
Not only has the volume of investment increased but there has also been an increase in the average ticket size from $134 million to $184 million." This shows how investors turned positive towards India post-Modi becoming the prime minister. If investment done in US dollar alone is considered, the average ticket size has gone up from $ 159 billion in 2009-13 to $ 388 billion in the ongoing phase that started in 2014," he said,
During the pre-GFC phase, 82% of funds got raised in US Dollar. This reduced to 57% in post-GFC phase when the going got tough and micro-market understanding was required more than banking on the macro-economy alone. The contribution, 2014-onwards, has increased considerably to 70% – hinting that the positivity is here to stay for some time, Agarwal said.
"These changes reflect how foreign investor participation rises when the economy is moving up but when the tide turns, it’s the domestic investors – with familiarity of developments in micro-markets – that increase their focus on investment," he said.
