Pvt equity investors fund realty sector amidst slowdown fears
Global real estate consultancy Cushman & Wakefield shows that total inflows in the sector for the first quarter of 2015 was Rs 5,168 crore
May 05, 2015
Source : The Times of India

 

 
PUNE: Property exhibitions, limited period offers and discounted sales are some of the desperate efforts real estate developers have made in the last few months that make us believe that all is not well on the realty front. But private equity investors have not lost faith in the potential this sector holds as they continued to pump in money through the last year and have almost doubled their investments during January-March (first quarter) this year.
 
The latest report on Private Equity investments in Real Estate (PERE) by global real estate consultancy Cushman & Wakefield shows that total inflows in the sector for the first quarter of 2015 was Rs 5,168 crore - higher by 85% from Rs 2,800 crore during the same quarter a year ago.
 
The increase in private equity investments during the first quarter (Q1) could be attributed to improved market sentiments thanks to a very strong push from the government in creating a more conducive business environment and higher investments in residential and commercial office assets, which increased by 158% and 68% respectively compared to the same period last fiscal, the report has highlighted.
 
The residential sector attracted the highest transaction volumes during the quarter with a 53% share in total investment activity, the rest 47% going to the commercial/office sector.
 
Amid liquidity issues faced by residential developers due to subdued demand and restricted access to debt funding, private equity funds have emerged as an important alternative source to meet the funding requirements, the report said, adding that investments continue in the residential sector at the project level rather than at the entity level to protect their investments.
 
At the national level, Chennai recorded the highest level of transaction volume in the first quarter with investments of Rs 2,881 crore, nearly six times the investments in the same period of last fiscal. Investments in Chennai were primarily in residential assets (84%) and remaining (16%) were in commercial office assets. Delhi-NCR followed Chennai with second highest investments at Rs 926 crore. Investments in Bengaluru more than doubled (Rs 902 crore) from the previous quarter.
 
In the first quarter of this fiscal, residential assets recorded the second highest private equity investment since 2008. The total value of investments in the residential sector was 2.5 times more than the first quarter of last fiscal and was recorded at Rs 2,752 crore. Relatively attractive return on investments and easy exits increased focus on housing from the Narendra Modi-led BJP government and high funding needs are likely to sustain the high investments in residential assets, the report added. 

Latest Realty News

Bonanza-for-some-Mumbai-builders-who’ve-exceeded-FSI-limits
May 05, 2015
MUMBAI: The BJP-controlled state urban development department (UDD) is set to favour some builders
HUDA-eyes-Rs-3,000-cr-windfall-through-registry-of-plots
May 05, 2015
GURGAON: Haryana Urban Development Authority (HUDA) is about to send notices to allottees by May-end to ensure plots are registered
Brookfield,-Incor-to-jointly-develop-Rs-500-cr-mixed-use-project-in-Hyderabad
May 05, 2015
HYDERABAD: A joint venture Realty project approximately worth a whopping Rs 400-500 crore has made its way into the 'hi-tech' city
Maharashtra-mulls-SEZ-Prevention-of-Land-Speculation-Bill
May 05, 2015
MUMBAI: The Maharashtra government plans to introduce a 'SEZ Prevention of Land Speculation Bill'
Bhubaneshwar-developers-hope-revised-realty-bill-will-drive-growth
May 05, 2015
Bhubaneswar: Developers in the city feel certain key changes proposed by the new dispensation were urgently needed for the survival of the real estate sector
Home-developers-continue-to-restrict-new-launches-on-huge-inventory
May 05, 2015
NEW DELHI: Developers across the top six cities continuing to restrict new residential project launches
India-for-deeper-engagement-of-ADB-for-smart-cities,-railways
May 05, 2015
New Delhi: Finance Minister Arun Jaitley sought "deeper engagement" of the Asian Development Bank (ADB) for development of smart cities
Maharashtra-govt-plans-to-start-'housing-fund'
May 05, 2015
Mumbai: In a bid to make homes more affordable for people in Maharashtra, the state government is planning to start a 'housing fund'
Secondary-property-market-showing-signs-of-recovery
May 05, 2015
New Delhi: Sales in the secondary property market are slowly picking up
Modi-government-faces-opposition-test-on-GST-and-Real-Estate-Bills
May 05, 2015
NEW DELHI: The government's legislative agenda may suffer a setback

Latest Realty News Of State

Realty Talk's