During Q1 2021, private equity investment inflows into the Indian real estate sector amounted to USD 1.9 billion (INR 135 billion). The first quarter of 2021 already clocking in about nearly a third of the investment inflows that the sector witnessed in the entire year 2020, is a sign of investors’ regaining confidence after the pandemic-struck slowdown period.

Despite the remote-working culture sweeping in, commercial office assets remained the frontrunner during Q1 2021, garnering more than half (58%) share of the investment pie. All the quarterly investment came from foreign institutional investors and was mostly concentrated in the two southern cities of Bengaluru and Hyderabad. Investors were also noted to undertake development risk as investible ready grade core assets are becoming scarce.

The increased demand for warehousing facilities, especially from e-commerce and third-party logistics players, has steered private equity institutional investments into the sector. During Q1 2020, investors such as Blackstone and Ascendas Firstspace formed platforms to develop and invest to the tune of USD730 million (INR53 billion) in industrial facilities in the cities of Pune, Bengaluru, Hyderabad and Chennai.