In the first half of 2024, India achieved a significant milestone by ranking third among global cross-border capital destinations for land and development sites, as reported in Colliers’ Global Capital Flows Report.
The Asia Pacific (APAC) region emerged as a crucial player in the global cross-border capital market, with countries like Singapore, Hong Kong, Japan, and China making the top ten. Japan and China also ranked among the top five global destinations for capital targeting standing assets. Australia was another APAC country listed in the top ten.
"Foreign investment in India's industrial and warehousing sector has gained notable momentum. In the first half of 2024, nearly 70% of the foreign investments in India’s real estate sector were directed towards industrial and warehousing assets. This investor interest is fueled by increasing demand from third-party logistics (3PL) and e-commerce sectors, along with the strengthening of manufacturing capabilities across key industrial corridors in the country. India's growing attractiveness as a major industrial investment hub underscores long-term confidence in this sector," said Piyush Gupta, Managing Director of Capital Markets & Investment Services at Colliers India.
Recent significant asset-level deals involving foreign funds include Daibiru Corporation, a subsidiary of the Japanese conglomerate Mitsui O.S.K. Lines, which invested ₹1,000 crore in an under-construction office complex in Gurgaon developed by DLF-Hines. Additionally, the Abu Dhabi Investment Authority (ADIA) and KKR invested in Reliance Retail Ventures Limited's warehousing assets, with the transaction valued at ₹12,864 crore. Maple Tree also acquired 41 acres of land from Adarsh Developers for ₹1,900 crore.
In the APAC region, the office sector was the primary target for investment activity in the first half of 2024, followed closely by the industrial sector. Notably, investments in industrial and warehousing assets in India saw a fivefold increase compared to the previous year. This surge is attributed to rising demand for high-quality Grade A assets and evolving supply-chain models, which have significantly enhanced global investor confidence in the sector.
"With strong domestic demand, healthy GDP growth, and anticipated easing of monetary policies, investments in the Indian real estate sector are expected to remain robust. Foreign inflows, which accounted for 73% of investments in the first half of 2024, will continue to play a dominant role in institutional investments. While North America and EMEA will lead in foreign fund inflows, there is growing interest from investors across the broader APAC region," said Vimal Nadar, Senior Director and Head of Research at Colliers India.
Institutional investor interest in Indian real estate remained strong with $3.5 billion in inflows during the first half of 2024. Although 70% of these investments were directed towards ready assets, India's rapid growth and infrastructure development will continue to present numerous opportunities for developmental investments in the coming years.
“APAC remains a hub of economic activity, offering diverse investment opportunities across traditional sectors such as residential, commercial, and industrial logistics, as well as emerging sectors like data centers and cold storage. Improving market fundamentals are expected to create new investment opportunities, with global rate cuts signaling optimism for real estate markets,” said Chris Pilgrim, Colliers’ Managing Director of Global Capital Markets, Asia Pacific.
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