Investments in realty remain strong in Q1 2023, office sector mops up 55%

Inflows into office sector up 41% YoY to $900 mn. Key institutional investors signing strategic deals to boost their presence, expand their office portfolio in India

Institutional investments in real estate remained strong during the first quarter of the calendar year 2023 at $1.7 billion, led by the office sector, which accounted for 55 per cent of the total inflows during the quarter, followed by the residential sector at 22 per cent, finds a Colliers report.

Investment inflows in the office sector rose by 41 per cent year-on-year to $900 million, led by select large deals. Owing to the strong growth prospects in the office sector, key institutional investors are entering into strategic partnerships to strengthen their presence and expand their office portfolio in India.

Investments from domestic investors rose four times YoY during the quarter. Domestic investors remained focused on residential assets despite higher lending rates, the report said.

 

Global investors, however, favoured office and industrial assets, and dominated overall inflows with a 76 per cent share. Larger markets such as Delhi-NCR and Bengaluru attracted a third of all investments during the quarter, led by increased activity in these markets. However, 63 per cent of the inflows were through multi-city deals.

The institutional flow of funds includes investments by family offices, foreign corporate groups, foreign banks, proprietary books, pension funds, private equity, real estate fund-cum-developers, foreign-funded NBFCs and sovereign wealth funds.