Institutional investment in real estate likely to fall

Institutional investments in real estate could fall 20 percent to $ 4 billion this calendar year due to higher cash inflows in 2020, according to real estate consultant JLL India. Institutional investments for January-September increased to $ 2,977 million from $ 1,534 million a year ago.

“Unless some large portfolio deals are signed by the end of the year, annual investments are projected to be in the range of $ 3.8 billion to $ 4 billion in 2021,” JLL said in a statement.

Institutional investments managed to break the $ 5 billion mark in 2020 due to large portfolio transactions valued at $ 3.2 billion in the final quarter of the year. “However, in 2021 there was a broader recovery with 31 deals in the first nine months versus 19 deals in the same period in 2020,” it noted.

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Looking at the outlook for the next year, JLL India expects investments to exceed the $ 5 billion mark, which Indian real estate has seen annually over the 2017-2020 period.

Institutional cash flow includes investments from family offices, overseas corporate groups, overseas banks, own books, pension funds, private equity, real estate funds with developers, foreign-funded NBFCs, and sovereign wealth funds. It also includes anchor investors in REITs.