Real estate records highest PE investment in five years: Anarock
Real Estate

Real estate records highest PE investment in five years: Anarock

The Indian real estate sector has recorded the highest-ever private equity (PE) investments since FY2016 despite covid-induced disruptions.

According to a report by Anarock, more than $6.27 billion were invested into the sector in FY21 as against $5.8 billion in FY20, an increase of 19% in one year.

Unlike earlier, private equity investors in FY21 have focused mainly on portfolio deals across multiple cities and assets rather than on specific projects or cities. Such portfolio deals constituted 73% of the overall share, with nearly $4,583 million invested via portfolio deals in multiple cities.

Even as the Covid-19 pandemic adversely affected several industry sectors in FY21, the PE funds pumped into the real estate sector remained strong. As much as 93% of the total PE investments into the Indian real estate market were by foreign investors. In actual terms, investments by foreign PE funds almost doubled from $3 billion to $5.8 billion in FY21. In contrast, domestic PE funds invested merely $300 million compared to $420 million in FY20, the report said.

The average ticket size of PE deals increased by 62% in the fiscal year, from $110 million in FY20 to $178 million in FY2021. Both structured debt and equity witnessed strong growth during the year at 84% and 15%, respectively. Structured debt was largely towards portfolio deals instead of project-level assets.

Among the foreign PE investors that remained major contributors for overall PE inflows in India, the US and Canada-based investors pumped in more than 50% of the total foreign PE investments in FY21, the Anarock report said.

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Also read: New FDI norms will help revive construction and infrastructure

Also read: NRI investments in Indian real estate may grow at 12%: Report

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The Indian real estate sector has recorded the highest-ever private equity (PE) investments since FY2016 despite covid-induced disruptions. According to a report by Anarock, more than $6.27 billion were invested into the sector in FY21 as against $5.8 billion in FY20, an increase of 19% in one year. Unlike earlier, private equity investors in FY21 have focused mainly on portfolio deals across multiple cities and assets rather than on specific projects or cities. Such portfolio deals constituted 73% of the overall share, with nearly $4,583 million invested via portfolio deals in multiple cities. Even as the Covid-19 pandemic adversely affected several industry sectors in FY21, the PE funds pumped into the real estate sector remained strong. As much as 93% of the total PE investments into the Indian real estate market were by foreign investors. In actual terms, investments by foreign PE funds almost doubled from $3 billion to $5.8 billion in FY21. In contrast, domestic PE funds invested merely $300 million compared to $420 million in FY20, the report said. The average ticket size of PE deals increased by 62% in the fiscal year, from $110 million in FY20 to $178 million in FY2021. Both structured debt and equity witnessed strong growth during the year at 84% and 15%, respectively. Structured debt was largely towards portfolio deals instead of project-level assets. Among the foreign PE investors that remained major contributors for overall PE inflows in India, the US and Canada-based investors pumped in more than 50% of the total foreign PE investments in FY21, the Anarock report said. Image Source Also read: New FDI norms will help revive construction and infrastructure Also read: NRI investments in Indian real estate may grow at 12%: Report

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