Industrial, Logistics & Residential Top 2021 Investment Chart

Piyush Gupta, Managing Director, Capital Markets and Investment Services and Vimal Nadar, Senior Director and Head of Research, Colliers India share their perspectives. Real estate institutional investment volumes closed at USD4billion in 2021. Although it is a 17% dip yoy, also because of some large transactions had concluded in 2020, the capital flows came on a broad-based recovery across most asset classes, geographies and doubled in the number of deals compared to 2020. 2021 has been one of the best years for the industrial & logistics and residential sectors, accounting for about half of the total investments at about USD2 billion.  Investments in the residential sector witnessed a two-fold rise in 2021; the luxury segment makes a comeback. As compared to last year, the share of single city deals witnessed a two-fold increase during 2021, indicating investors’ rising preference towards specific high-quality assets in key locations. “The pandemic has accelerated a number of structural trends and will have lasting changes on the nature of real estate business in India. The Investments across asset classes have seen promising inflows in 2021 reflecting several opportunities for investors to recalibrate their strategy towards growth sectors. This is already evident in the rapid investment being allocated towards the residential, increasing development of data centers, alternatives, industrial, office as well as the evolution of the life science sector. There is a reflection of confidence in the industry to participate in the growth story and hence develop, build and own real assets in long term.” says, Piyush Gupta. Sharing his views Vimal Nadar adds, “The year 2021 has seen a strong investor appetite for residential and industrial & logistics sectors while office continues to be dominant. The former breached record highs in recent times lapping up nearly USD2billion of the overall institutional investment volumes. This resonates the strong fundamentals and attractive valuations of the underlying assets supported by a positive economic outlook. The broad-based recovery signals signs of ebullience amongst investors and expansion of REITs, asset diversification, imminent potential in industrial & logistics will keep them busy in the Indian market. Moreover, niche asset classes such as Data centers, student housing and life science will provide a unique opportunity for investors to diversify their investments.”