What do foreign investors in real estate look for?
Real Estate

What do foreign investors in real estate look for?

Over the past few years, 100 per cent FDI has been permitted in construction development, with the intention of attracting foreign investment in Indian realty, says Shobhit Agarwal, Managing Director & CEO, Anarock Capital. 
So, have recent reforms helped increase the interest of overseas funds in India?

“Over the past five years, overseas pension funds, sovereign wealth funds and real-estate funds have invested ~$10 billion in Indian realty, primarily towards buying out ready assets and financing for upcoming assets,” says Prateek Jhawar, Director and Head, Infrastructure & Real Assets, Avendus Capital. “In 2017, these funds emerged as the biggest investors accounting for ~70 per cent ($2.2 billion) of real-estate investments in India. Most funds are entering India at a time when developers are struggling to stay afloat and equity funding is far from frequent. Their investments in development tend to take the form of structured equity/debt in the early stages of the project for development; whereas the buyout of income generating assets provides a much-needed exit channel for liquidity-seeking developers.”

“With the government undertaking reforms in areas such as RERA and ease in InvIT/ REIT regulations, global funds seem to be gaining more confidence in Indian real estate and are opting for JV or platform deals,” Jhawar continues. “They see potential to grow over a 7-10 year horizon, especially with good developers that generate good returns over the real-estate cycle. Players such as GIC, Brookfield, CDPQ, APG, Qatar Holdings, etc, have already entered the Indian real-estate market with plans for long-term investments. Qatar Holdings has recently pumped $250 million in Arthaveda Fund Management to invest in low and middle-income residential projects.”

In future, Jhawar expects real-estate funds to play a key role in financing projects as the average size of projects is increasing and the NBFC sector is facing a liquidity crunch. 

“Foreign investors are definitely interested in investing in real-estate projects in India,” says Karan Bolaria, CEO, Godrej Fund Management. “They look for projects delivering returns of 15-18 per cent to cover the currency risk, development risk and any country-specific risks along with their own returns thresholds.”

 

Over the past few years, 100 per cent FDI has been permitted in construction development, with the intention of attracting foreign investment in Indian realty, says Shobhit Agarwal, Managing Director & CEO, Anarock Capital.  So, have recent reforms helped increase the interest of overseas funds in India? “Over the past five years, overseas pension funds, sovereign wealth funds and real-estate funds have invested ~$10 billion in Indian realty, primarily towards buying out ready assets and financing for upcoming assets,” says Prateek Jhawar, Director and Head, Infrastructure & Real Assets, Avendus Capital. “In 2017, these funds emerged as the biggest investors accounting for ~70 per cent ($2.2 billion) of real-estate investments in India. Most funds are entering India at a time when developers are struggling to stay afloat and equity funding is far from frequent. Their investments in development tend to take the form of structured equity/debt in the early stages of the project for development; whereas the buyout of income generating assets provides a much-needed exit channel for liquidity-seeking developers.” “With the government undertaking reforms in areas such as RERA and ease in InvIT/ REIT regulations, global funds seem to be gaining more confidence in Indian real estate and are opting for JV or platform deals,” Jhawar continues. “They see potential to grow over a 7-10 year horizon, especially with good developers that generate good returns over the real-estate cycle. Players such as GIC, Brookfield, CDPQ, APG, Qatar Holdings, etc, have already entered the Indian real-estate market with plans for long-term investments. Qatar Holdings has recently pumped $250 million in Arthaveda Fund Management to invest in low and middle-income residential projects.” In future, Jhawar expects real-estate funds to play a key role in financing projects as the average size of projects is increasing and the NBFC sector is facing a liquidity crunch.  “Foreign investors are definitely interested in investing in real-estate projects in India,” says Karan Bolaria, CEO, Godrej Fund Management. “They look for projects delivering returns of 15-18 per cent to cover the currency risk, development risk and any country-specific risks along with their own returns thresholds.”  

Next Story
Infrastructure Urban

India To Invest $37 Billion To Boost Petrochemical Capacity

India is set to become a major global player in the petrochemicals industry, driven by a planned capital expenditure of $37 billion (Rs 3.1 trillion) aimed at reducing import dependency and enhancing self-sufficiency, according to S&P Global Ratings.In its latest report titled “First China, Now India: Self-Sufficiency Goals Will Add To Petrochemicals Supply”, S&P said India’s large-scale capacity expansion—mirroring China’s earlier push—will likely intensify oversupply pressures in Asia’s petrochemical markets.Currently the world’s third-largest petrochemical consumer a..

Next Story
Infrastructure Transport

Indian Railways Expands Global Exports Of Rail Equipment

Indian Railways has announced that it is rapidly emerging as a global exporter of railway equipment, including bogies, coaches, locomotives, and propulsion systems, under the government’s ‘Make in India, Make for the World’ initiative.According to an official statement, India’s railway products are now reaching over 16 international markets, reflecting the country’s growing capacity to design, develop, and deliver world-class rail solutions.Metro coaches have been exported to Australia and Canada; bogies to the United Kingdom, Saudi Arabia, France, and Australia; propulsion systems t..

Next Story
Infrastructure Transport

RailTel Awards Rs 163 Million Contract To RTNS Technology

RailTel Corporation of India Limited (RailTel), a Mini Ratna Public Sector Undertaking, has awarded a domestic work order worth Rs 163 million to RTNS Technology Private Limited.The contract, issued on 30 September 2025, involves the supply and installation of equipment and related services for one of RailTel’s key customers. The project underscores RailTel’s commitment to advancing technology and communication infrastructure through collaboration with domestic system integrators.RTNS Technology Private Limited, an ISO-certified system integrator, provides comprehensive solutions for perim..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Talk to us?