Residential Property Remains Most Favoured Asset
Class for Investors in India..!
Attracts 56% of the overall investment in
1H2017; more than double of the office figure
By Mr. Shobhit Agarwal, JLL India
In 1H2017, residential projects (including townships)
across India attracted 56% of the total investment, i.e. more than INR 9,000cr
out of the total 16,008cr. Commercial projects (including IT) got 22% or INR
3,500cr, followed by warehousing at 20% of the total. Retail could attract only
4% of the total amount due to the lack of quality mall supply.
These investment
figures are a combination of debt and equity.
Source: JLL Capital Markets Research
While the office asset class saw lower investment in 1H2017
compared to 1H2016 due to a lower number of equity deals, there are big-ticket
deals in the pipeline that are expected to fructify in 2H2017. Residential, on
the other hand, has cornered more than half of the total investments in 1H2017
thanks to the growing confidence in this asset class as RERA and GST get
implemented and demonetization as well as the Benami Property Act promise to
make residential real estate a far more transparent than it was ever before.
New kid on the block
Warehousing that has started seeing big-ticket
investments saw the biggest investment deal so far in the country’s logistics
space, brokered by JLL. As part of the USD 500 mn pact, the Canada
Pension Plan Investment Board (CPPIB) acquired a majority stake in IndoSpace,
the warehousing and logistics real estate arm of Everstone Group. As
part of this deal, CPPIB will acquire 13 industrial and logistics parks
totalling 14 mn sft.
IndoSpace and CPPIB have also agreed to create a
joint venture called IndoSpaceCore that will focus on acquiring and
developing logistics facilities in India. While CPPIB has invested over USD
3.07 bn from 2015 – mostly into real estate and infrastructure, Everstone is
the largest India-focused private equity investor with over USD 3.3 billion of
assets under management. It is pertinent to note here that even though CPPIB
may be the biggest deal so far, investors from other nations, especially Asian
ones like China, Japan, Korea, have shown a lot of interest in developing
industrial projects.
About the author..
Mr. Shobhit Agarwal, MD – Capital Markets and
International Director, JLL India.
For media contact
Arun Chitnis
Head - Corporate Communications & Media Relations
JLL India
Level 6, Amar Avinash Corporate Plaza
Bund Garden Road,
Pune 411001.
Tel: (020) 40196100 Fax: (020) 40196101
Mob: 91 9657129999
Website: www.joneslanglasalle.co.in
Blog: www.joneslanglasalleblog.com/realestatecompass
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