Where are real investments heading in 2019?
Real Estate

Where are real investments heading in 2019?

In just the first three months of 2019, PE real-estate investment came close to $ 1 billion, with 40-50 per cent in commercial and about 30 per cent in warehousing and logistics. The majority came through a single deal when Brookfield acquired the hotel assets of Leela Ventures for $ 570 million. “Hospitality is attracting more interest but the flows are still not as consistent as office; and those are likely to continue even in the balance of 2019,” says Sonit Singh, COO and Head, Cross Border Capital Markets, JLL India. However, Anarock estimates hotel transaction volumes to cross $ 800 million in 2019, the highest for the Indian hospitality industry.

Investor interest in long-term, real-estate plays with preferred developers continues to be visible with additional platforms of over $ 500 million getting created in just two-and-a-half months.

Besides, a recent Bombay High Court interim order has paved the way for what is called Mumbai’s biggest building deal—at Rs 25 billion—between Blackstone and Radius Developers for a building in Bandra-Kurla Complex. According to sources, Blackstone aims to replicate its office success story in retail—not just with income-producing assets but involvement at the development stage as well.

Going forward, institutional investors are likely to continue infusing investments in real estate. “Along with Mumbai, Pune and Chennai, Delhi-NCR and Bengaluru are also likely to be on the radar,” predicts Nikhil Bhatia, Managing Director and Co-head, Capital Markets, CBRE India. As for financing, Sanjeev Chandiramani, National Director-Capital Markets, Knight Frank (India), says, “We expect an improving scenario for domestic funds with increased retail, HNI and UHNI investments in fund platforms and improved FPI and FDI in development and financing platforms, resulting in delivery of projects across asset classes and markets. Eventually, (Q3 onwards) we expect that rate benefits will be passed to both retail and wholesale credit, resulting in capital efficiencies and improved project returns.” Singh confirms we will see a couple of investments in this quarter as well, to the tune of about $ 500-600 million.

An unstable election year, but a buoyant one already!


- SERAPHINA D’SOUZA


In just the first three months of 2019, PE real-estate investment came close to $ 1 billion, with 40-50 per cent in commercial and about 30 per cent in warehousing and logistics. The majority came through a single deal when Brookfield acquired the hotel assets of Leela Ventures for $ 570 million. “Hospitality is attracting more interest but the flows are still not as consistent as office; and those are likely to continue even in the balance of 2019,” says Sonit Singh, COO and Head, Cross Border Capital Markets, JLL India. However, Anarock estimates hotel transaction volumes to cross $ 800 million in 2019, the highest for the Indian hospitality industry.Investor interest in long-term, real-estate plays with preferred developers continues to be visible with additional platforms of over $ 500 million getting created in just two-and-a-half months.Besides, a recent Bombay High Court interim order has paved the way for what is called Mumbai’s biggest building deal—at Rs 25 billion—between Blackstone and Radius Developers for a building in Bandra-Kurla Complex. According to sources, Blackstone aims to replicate its office success story in retail—not just with income-producing assets but involvement at the development stage as well.Going forward, institutional investors are likely to continue infusing investments in real estate. “Along with Mumbai, Pune and Chennai, Delhi-NCR and Bengaluru are also likely to be on the radar,” predicts Nikhil Bhatia, Managing Director and Co-head, Capital Markets, CBRE India. As for financing, Sanjeev Chandiramani, National Director-Capital Markets, Knight Frank (India), says, “We expect an improving scenario for domestic funds with increased retail, HNI and UHNI investments in fund platforms and improved FPI and FDI in development and financing platforms, resulting in delivery of projects across asset classes and markets. Eventually, (Q3 onwards) we expect that rate benefits will be passed to both retail and wholesale credit, resulting in capital efficiencies and improved project returns.” Singh confirms we will see a couple of investments in this quarter as well, to the tune of about $ 500-600 million. An unstable election year, but a buoyant one already! - SERAPHINA D’SOUZA

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