Global Real Estate Consultancy, Cushman & Wakefield on Monday reported that private equity (PE) investments in real estate increased 13% in 2013 compared to 2012.
The total inflow last year was Rs 7,000 crore; it was Rs 6,200 crore in 2012.
Overall private equity investments across sectors in India have also increased by 11% from USD 9.49 billion in 2012 to USD 10.5 billion in 2013. "The increase in private equity inflows was primarily due to rising investments in residential assets and other sectors like retail and hospitality, it said. While the number of deals has increased to 40 in 2013 compared to 34 in 2012, the average deal size has declined marginally and was approximately Rs 175 crore (USD 28 million). "Given the difficult economic conditions, developers are finding it increasingly difficult to raise capital through traditional sources and are opting for alternate sources," said the report.
The total Foreign Direct Investment (FDI) inflow in Construction Development for the third quarter of 2013 was noted at Rs 3,200 crore (USD 520 million), which is the highest quarterly investment since Q3 2009. FDI inflow for the first three quarters of 2013 in Construction Development was Rs 5,500 crore (USD 900 million), a 25% increase from the same period in 2012.
The realty index grew by approximately 24% in Q4 2013. The report said overall net-absorption in the commercial office sector has been lower in 2013; primarily due to high relocation and consolidation activity with occupiers moving to better quality, larger and cheaper spaces in the suburban and peripheral locations.
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