With nearly $3.5 bn in foreign inflows, India 3rd favourite spot for investors wanting to put money into land

About 70% of the total foreign investment inflows into the Indian real estate sector during H1 2024 were directed towards the industrial and warehousing segment

India's real estate sector attracted foreign investment inflows to the tune of nearly $3.5 billion in the first half of 2024, making it the third most preferred global destination for land and development sites, according to a report by international property consultancy Colliers.

With nearly $1.5 bn in foreign inflows, Indian ranks third in global destinations for land/development sites during H1 2024 (Ramesh Pathania/Mint)

China and Singapore occupied the first and second spot, respectively.

In fact, home to seven out of the top-10 names on the list, the larger Asia Pacific region emerged as the market leader within the category for the period under review.

As per data cited in the report, India's real estate sector secured a total of $3.5 billion in investment inflows during the first six months of 2024. Foreign investment drove 73% of the total investments in India’s real estate market, with cross-border investments reaching over $1.5 billion. The APAC region contributed over $1.2 billion in inflows, according to the ‘Global Capital Flows Report’.

“Investor affinity is being driven by rising demand from 3PL and E-commerce players and strengthening of manufacturing capabilities across key industrial corridors of the country,” said Piyush Gupta, Managing Director, Capital Markets and Investment Services at Colliers India.

Presenting a future outlook, the report stated that even as 70% of investments during H1 2024 were focused on ready assets, India’s fast-paced growth and infrastructure development will continue to offer numerous opportunities in developmental assets over the coming years.

“Backed by robust domestic demand, healthy GDP growth and likely easing of monetary policy in the next few quarters, investments in Indian real estate sector will remain steady. Evident from a 73% share during H1 2024, foreign inflows will continue to dominate institutional investments in the near-term,” said Vimal Nadar, Senior Director and Head of Research, Colliers India.

The big picture

In the larger Asia Pacific region, Singapore, Hong Kong, Japan and China featured among the top-10 global cross-border capital sources in the first half of 2024. The US topped the list with over $32.5 billion in total real estate investment outflows during the period.

Meanwhile in terms of global capital, targeting standing assets, Japan and China were in the top five destinations globally with Australia too representing the APAC region within the top-10 list.