The Business Bytes
THEBUSINESSBYTES BUREAU
NEW DELHI, JANUARY 6, 2025
The Indian real estate sector witnessed a remarkable surge in 2024, with institutional investments reaching a record $6.5 billion, marking a 22 per cent increase from the previous year’s $5.4 billion, according to a report released on Monday. This growth was predominantly driven by the booming industrial and warehousing segments.
Foreign investments played a crucial role, contributing $4.3 billion, or 66% of the total inflows, while domestic investments surged by 27% during the year. Mumbai led the charge with $1.6 billion, accounting for 24% of the nation’s real estate investments. Meanwhile, Bengaluru, Chennai, and Delhi NCR each captured 8-9 per cent of the investment pie.
The final quarter of 2024 stood out with a robust $1.9 billion in investments, more than doubling the previous year’s Q4 figures. Domestic investors made significant strides, contributing 43 per cent of the inflows in this period.
The industrial and warehousing sector took center stage, commanding 39% of the total real estate investment volumes, overshadowing the traditionally dominant office segment. This shift was underpinned by strong manufacturing growth, reflected in positive macroeconomic indicators like the Manufacturing Purchasing Manager’s Index (PMI) and the Index of Industrial Production (IIP).
The residential sector also saw a boost, with investments climbing to $1.1 billion, a 46 per cent increase from 2023. Badal Yagnik, CEO of Colliers India, noted that APAC investors were a major force, contributing nearly a third of the foreign inflows. He expressed optimism for 2025, anticipating heightened capital deployment from domestic investors, fueled by government initiatives like ‘Make in India’ and infrastructure development.
The report highlighted the growing demand for Grade A developments and evolving supply chain models, which are set to further attract investors to consolidate industrial and warehousing assets in India. Vimal Nadar, Senior Director and Head of Research at Colliers India, emphasized that the increasing efficiency in logistics and India’s rising stature as a global manufacturing hub will continue to bolster investment in these sectors.
