Indian realty's institutional fund inflow in 2020 seen at USD 4.8 bn

During July-September, India's real estate market attracted $235 million in capital, growing by 52 per cent quarter-on-quarter (QoQ), showed JLL's 'Capital Markets Update: Q3 2020' report.

"The India real estate sector is expected to draw $4.8 bn of capital in 2020, representing a 8 per cent decline on 2019's total transactional volume of $5.3 billion," it said.

According to JLL, investors are most attracted to the country's office sector, with interest remaining strong throughout the pandemic and the partial relaxation of the lockdown with $200 million invested during Q3 2020.

Concurrently, global investors actively sought asset portfolio opportunities, with two landmark portfolio transactions amounting to a total of $3.6 billion in investment value likely to be concluded in Q4 2020.

In the primary markets, Mindspace Business Parks REIT, India's second REIT issue, of $600 million was oversubscribed by 13 times in August 2020. The strong response to this REIT indicates a preference for cash flow opportunities in private and public markets,  it said.

"We're expecting a broad based 'V-shape' recovery in the Indian real estate market, but depending on the economic recovery and pandemic response, our estimates have substantial scope for upward revision," said Ramesh Nair, CEO and Country Head (India),  JLL.

"We have already witnessed very positive signs of recovery in the office segment in Q3 with gross leasing at 13.8 mn square feet. The REITs market has done exceedingly well with the combined market cap of the India REITs at $6 bn accounting for 33 per cent of the market cap of listed real estate companies," he said.