At close to Rs 53,000 cr, investments into real estate set to touch 7-year high

Investments into the real estate sector in 2015, at close to $8 billion or Rs 53,000 crore, are poised for a seven-year high. Much of this has come in via the private equity (PE) route and borrowings through non-convertible debentures (NCD).

The size of the inflows might seem surprising given the sector is not particularly in good shape. The residential space, in particular, has been under pressure though the commercial property piece has done reasonably well. However, less than a fifth of the PE funds raised has found its way into commercial real estate; the bulk flowing into residential ventures allowing prices to remain firm. Indeed, if developers have not dropped prices, it’s thanks to investors backing them.

Cushman and Wakefield estimates around $2.8 billion or Rs 18,700 crore had been invested by private equity players in the real estate market till end September. Add to that an estimated $4.5 billion, or Rs 30,500 crore, of NCDs — till November 2015 — and the tally is already up by 74% over last year’s Rs 17,600 crore.

Read Full Story: At close to Rs 53,000 cr, investments into real estate set to touch 7-year high