Global PE in­vest­ment to rise by Rs. 12,000 crore says re­port

Accommodation Times - - Real Estate Investments - By Staff Re­porter

In­dian real es­tate mar­ket has seen a rise in global pri­vate eq­uity in­vest­ment, as sec­ond half of 2014 is ex­pected to see around Rs. 7, 900 crore in­vest­ment against the first half of the year, which saw Rs. 4,100 crore. As per a re­port by Prop­erty con­sul­tant Cush­man & Wake­field, global PE in­vest­ment in In­dia will in­crease up to Rs. 12,000 crore by the end of this year. They said global PE play­ers find real es­tate in In­dia worth in­vest­ing for good re­turns, the funds are be­ing raised mainly for hous­ing projects and leased of­fice pur­chases. Sec­ond half of this year wit­ness a good re­sult fol­low­ing the big deals tak­ing place in the com­mer­cial of­fice space dur­ing the pe­riod. As projects in the com­mer­cial of­fice space are more eco­nom­i­cally vi­able, PE in­vest­ments have been bet­ting on them due to high oc­cu­pan­cies and the trend is set to con­tinue till year-end. “Clar­ity in gov­ern­ment process will be crit­i­cal to the in­vest­ment mar­ket. Re­cent an­nounce­ments by the cen­tral gov­ern­ment will spur in­vest­ments into the sec­tor,” said Cush­man & Wake­field’s South Asia man­ag­ing di­rec­tor San­jay Dutt on the oc­ca­sion. Many sov­er­eign and pen­sion funds are pump­ing funds into the In­dian real es­tate like All Pen­sions Group (APG Group), Abu Dhabi In­vest­ment Au­thor­ity (ADIA), Qatar In­vest­ment Au­thor­ity ( QIA), Canada Pen­sion Plan In­vest­ment Board (CPPIB), State Gen­eral Re­serve Fund of Oman (SGRF) and GIC of Sin­ga­pore. Ban­ga­lore topped PE trans­ac­tions in the first half of 2014 with Rs.2,500 crore Aas against just Rs.103 crore in the cor­re­spond­ing pe­riod year ago. Whereas, Mumbai also saw healthy in­vest­ments worth Rs.1,140 crore though largely in the res­i­den­tial sec­tor. PE in­vest­ments in Mumbai shot up three times in first six months of this year over same pe­riod year ago, while trans­ac­tions in Na­tional Cap­i­tal Re­gion (NCR) and Pune were Rs.580 crore and Rs.167 crore. In­vest­ments were spread across the sec­tor, with com­mer­cial of­fice ac­count­ing for the ma­jor chunk (57 per­cent), fol­lowed by res­i­den­tial (28 per­cent) and re­tail (15 per­cent) as­set classes. PE in­vest­ment (Rs.4,100 crore) in first half (Jan­uary-June) was not only more than dou­ble of Rs.1,650 crore in same pe­riod of 2013, but also the high­est since like pe­riod of 2009 when a whop­ping Rs.4,950 crore ($1 bil­lion) was in­vested then.

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