Private Equity investment increases in Pune’s real estate
Pune real estate market showed an increase of about 300 per cent increase in private equity investment during 2013, it contributed an amount of over Rs. 1, 464 crore, in the year 2013. This was revealed in a research report by Cushman & Wakefield has said. “With growing housing demand, investments in the right project have the potential to yield healthy returns,” mentioned in the report.
According to the report, Pune city ranks on fifth position of the Rs 7,000 crore total inflows from private equity funds (13% higher than the previous year) in the country’s real estate sector for the year. The increase in private equity inflows was primarily due to rising investments in residential assets and other sectors like retail and hospitality, the report said. “While the number of deals has increased to 40 in 2013 compared to 34 in 2012, the average deal size has declined marginally to Rs 175 crore ($28 million),” the report added.
The main factor which are attracting private investors are entry of real estate investment trusts (REITs), reducing fiscal deficit and expectations of fall in inflation and a pick up in GDP growth post the Lok Sabha elections, the report noted.
Sanjay Dutt, executive managing director for South Asia at Cushman & Wakefield, said, “The residential asset class continues to provide tremendous potential for growth in the coming years. With housing requirements growing across cities and funds investing in the asset class, primarily in the form of non- convertible debentures, providing fixed returns, investments in the right project have the potential to yield healthy returns.”
Anuj Puri, country head and chairman of real estate advisory company JLL India, said investors are enthusiastic about India as a vast army of young, educated Indians is set to turn the world’s second most populous country into a talent powerhouse. “The consumer base is growing fast as a swelling middle class comes online.”