Equity investment in Indian real estate will touch $10 billion in 2024, driven by strong inflows into office space assets and a growth pipeline for residential land acquisitions, according to reports released by the Confederation of Indian Industry and real estate consultant CBRE at the CII Realty 2024 conclave. The event was inaugurated by D Thara, Additional Secretary at the Ministry of Housing and Urban Affairs, who with industry leaders Anil Saraf and Ashwinder Singh reflected upon the dynamic growth of the sector.
This was equity investment into Indian real estate for the first three quarters of 2024, which has increased year-on-year by 46 per cent, at $8.9 billion as of the report. Deal flow is very robust, with almost 200 deals closed through this period, against 151 for the same period a year ago. Average deal size increased to around $45 million, compared to $36 million for 2023. Mid-sized deals of between $10 million and $50 million dominated the inflow bucket, bringing in 56% of total inflows.
Delhi-NCR, Mumbai, and Bengaluru continue to be the top investment hubs for capital, while the gateway cities captured over 63% of total inflows. Delhi-NCR led with a 26% share, receiving $2.3 billion. Tier-II and III cities also saw significant interest, with inflows touching $0.6 billion, with cities like Ludhiana, Mohali, and Indore accounting for nearly 76% of this growth.
Domestic investors, primarily developers, contributed nearly $6 billion, or 65%, of the total capital inflows, while foreign investors, led by North American and Singaporean entities, added $3.1 billion. Institutional investors and collective investment vehicles were a major source of capital, comprising almost 40% of the total investments.
The office sector saw a strong rebound, with inflows growing by 50% year-on-year. Land and development sites, particularly for residential and mixed-use projects, also garnered substantial investments, representing over 70% of total inflows. Residential developments, in particular, received nearly 64% of capital allocated to land sites.
New heights were reached in debt financing in the sector. During the first nine months of 2024, it crossed $4.7 billion, more than doubling the figure recorded in the previous year. Debt financing was concentrated to a great extent in majors like Delhi-NCR, Mumbai, and Bengaluru, while multi-city deals comprised more than 30% of total debt financing.
Experts will continue to see the sector grow at a rapid pace, with regulatory support, like that offered by SEBI through its SM-REIT framework, likely to drive transparency and investment into high-quality assets across Tier-II cities.
