Institutional investment in real estate decline by 55% during Q1 2024
Institutional investment in real estate has declined by 55% during Q1 2024 to USD 552 million, due to the cautious approach of foreign investors amid global macroeconomic uncertainty, according to consultancy firm Vestian.
Domestic investors showcased resilience and accounted for 98% of the total institutional investments received in the current quarter. Although the share has increased from 36% a year earlier, investments in value terms increased by only 21%.
“Domestic investors are bullish about India’s growth story, continue to pour in investments in the real estate sector. On the other hand, foreign investors are cautious due to global macroeconomic uncertainty and geopolitical tensions,” said Shrinivas Rao, FRICS, CEO, Vestian.
Commercial assets (office, retail, co-working, and hospitality projects) garnered the highest investments of USD 232 Mn in Q1 2024, closely followed by residential assets at USD 225 Mn.
Despite an increase in the share of commercial investments to 42% in Q1 2024 from 39% a year earlier, they declined by 52% in value terms. Similarly, the share of residential investments also increased to 41% in Q1 2024 from 27% in Q1 2023. However, investments declined by 33% annually in value terms. Investments significantly decreased by 73% in the industrial and warehousing sector in Q1 2024 over the previous year.
Bengaluru dominated the institutional investments in Q1 2024 with USD 299 Mn, followed by NCR at USD 110 Mn. Both the cities together accounted for around 74% of the total investments
