Real estate PE investments has registered 28% yoy growth in Q1 FY23 as compared to Q1 FY22, stated ANAROCK Capital’s latest FLUX report. Accordingly, Improved market scenario, extensive vaccine coverage, and lifting of lockdown restrictions helped this revival.
Shobhit Agarwal, MD & CEO, ANAROCK Capital, said, “The improvement primarily progressed on the top 5 private equity deals, which considered for 90% of the total value of PE investments in current fiscal year. There has been 53% rise in average ticket size in Q1 FY23 when compared to Q1 FY22. Equity contribution to the total PE investments in Indian real estate increased to 87% in Q1 FY23 from 84% in corresponding year i.e Q1 FY22.”
Deal activity in Q1 FY23 shifted back to multi-city deals as compared to Q1FY22, from the previous focus on single-city deals. Also, NCR has gained noteworthy attention from PE investors, with the highest city-wise inflow at 48% in Q1 FY23 — a massive increase from 1% in Q1 FY22.
Asset Class-wise Funding
In Q1 FY23, deployments by JV platforms into in the commercial real estate sector have increased remarkably at 74%, especially in Grade A office spaces which are drawing very high investor interest.
The Industrial & Logistics sector has shown increased potential, with the creation of a new JV platform between Ivanhoe Cambridge, Bain Capital & Macrotech Developers for an investment of USD 1 Billion.
Domestic vs Foreign Funding
Foreign PE investors displayed increased confidence, with their contribution increasing to 89% in Q1 FY23 against 83% in Q1 FY22.
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