Five realty players and financial giants are looking to mop up a mammoth $10 billion via real estate investment trusts (REITs) over the next two years.
“This includes marquee names such as Brookfield, RMZ Group, Godrej Properties and Panchshil Realty. K Raheja Corp is also said to be closely monitoring the REIT platform for a debut by the end of FY21,” said a source who did not wish to be identified.
In a major sign of investors again taking a fancy to Indian real estate, the sector has garnered a whopping Rs 8,000 crore in the last fortnight alone. This comprises the Rs 3,200 crore QIP by DLF and the Blackstone-Embassy combine raising Rs 4,750 crore in India’s first ever REIT offering.
Private equity players have invested close to $53 billion since 2008 in India’s real estate story. And India’s maiden REIT listing last week is expected to bolster investor confidence, as it provides one more option of an exit to PE players.
Like investment banks, private equity firms are once again constructing plans for the Indian property market- primarily in commercial real estate. According to properly firm Anarock, new office stock rose 19% year on year in 2018. This is seen as good news at large by investors, as a pick up in commercial real estate is often considered to be an indicator of the overall performance of an economy.
The ground reality for residential market is however almost diametrically opposite, and remains primarily a buyers market. Builders are grappling with the twin problem of high debt and low sales with Unsold residential inventory at a staggering 6.73 lakh units across top seven cities, according to Anarock.