Private Equity Inflow in Indian Real Estate Shot up by 19% in FY21, Investor Eyes Attractive Portfolio Deals
Despite the critical times citing the deadly spread of the novel corona virus disease, the Indian real estate sector majorly including the Delhi real estate has still managed to set a record hike in private equity (PE) investments in the FY 2020-21 totaling to approximately 6.2 BnUSD, the highest level since the FY 2015-16. In a comparison with yesteryear where it summed up for a total of 5.8 BnUSD, thus surfacing a hike of 19% in PE investments as per the study conducted by the leading market experts.
The average ticketing of PE deals rose by 62% in FY 2021, which were 110 MnUSD in FY20 to 178 MnUSD in FY21. The structured debt and PE investment witnessed strong growth during the year at 84% and 15% respectively. Structured debt was largely towards portfolio deals instead of project-level assets.
On contrary to previous years, FY 2021 has witnessed a change in focus by the Private Equity (PE) investors on portfolio deals across multiple cities and reality, instead of some specific realty like property in Delhi or other cities. Such portfolio deals constituted 73% of the overall share, with around 4.58 BnUSD invested through portfolio deals in multiple cities.
As per the property consultant in Delhi “Foreign investments are very upbeat about the realty growth in India. Foreign investors have shown a sheer inclination towards investing in Indian realty due to the presence of graded rental immovable assets. Additionally, Indian realty is witnessing a strong demand to cater for the development of office spaces in metropolitans like Mumbai, Pune, Bangalore or Delhi.
Among various vital stats unveiled, one aspect is crystal clear that the assets like commercial units, retail spaces and hotel spaces have stood up with positive figures. To conclude, approximately 66% of the total PE investments aggregating to 6.27 BnUSD in FY21 was across portfolio deals in differential asset groups. On contrary, in FY20, out of the total $5.28 billion total inflows, just 8% of the total comprised portfolio deals.
