Institutional Investments In Real Estate Down 37% In Oct-Dec To USD 822 Mn: Colliers

Institutional investments in real estate fell 37 per cent annually in the October-December quarter of last year to USD 822.3 million as fund inflows were less in all asset classes, according to Colliers.

Real estate consultant Colliers India data showed that institutional investments in real estate stood at USD 822.3 million during October-December 2023, as against USD 1,299.40 million in the year-ago period.

The inflow of funds declined 23 per cent in the office segment to USD 135.5 million during the fourth quarter of last calendar year, from USD 175.5 million in the corresponding period of the previous year.

In housing, the investments plunged 79 per cent to USD 81 million in October-December 2023, from USD 379.1 million in the year-ago period.

Alternate assets saw a dip of 11 per cent to USD 418.7 million, from USD 467.9 million.

Alternate assets include data centres, life sciences, senior housing, holiday homes, student housing and schools among others.

Fund inflow in industrial and warehousing assets dipped 16 per cent to USD 187.1 million during October-December last year, from USD 222 million in the corresponding period of the previous year.

Mixed use projects did not attract any investments in the fourth quarter of 2023, as against USD 54.9 million in the year-ago period.

The institutional flow of funds includes investments by family offices, foreign corporate groups, foreign banks, proprietary books, pension funds, private equity, real estate fund-cum-developers, foreign-funded NBFCs and sovereign wealth funds.

During the entire 2023 calendar year, institutional investments in real estate grew 10 per cent to USD 5,380.40 million, from USD 4,877.90 million in the previous year.

The office segment dominated in fund inflow with a 53 per cent rise in investment to USD 3,022.50 million during last year, from USD 1,978.30 million in the 2022 calendar year.

In housing, the investments rose 20 per cent to USD 788.9 million in 2023, from USD 655.6 million in the previous year.

Fund inflow in industrial & Warehousing projects more than doubled to USD 877.6 million last year, from USD 421.8 million in 2022.

Alternate assets saw a 25 per cent decline in investments to USD 649.1 million, from USD 866.7 million.

Inflow of funds in mixed use projects fell sharply by 91 per cent to USD 42.3 million in 2023, from USD 463.7 million in 2022.

Retail assets did not receive any institutional investments last year as against USD 491.8 million in the 2022 calendar year, the Colliers data showed.