Rise in buyers’ confidence on Rera implementation – Realty sector gets Rs 24,011 cr investment in H1: Report

The real estate sector received an investment of around Rs 24,011 crore in the first half of 2018 due to rise in buyers’ confidence on Rera implementation and improving capital values, a report said.

The real estate sector received an investment of around Rs 24,011 crore in the first half of 2018 due to rise in buyers’ confidence on Rera implementation and improving capital values, a report said. IT parks and commercial real estate got the biggest investment share of USD 2,000 million or around Rs 13,151 crore, followed by retail real estate at around USD 300 million or Rs 1,898 crore, the joint report by industry body CII and property consultant JLL said today.

“In the first half of 2018, total investments in the sector stood at USD 3,616 million or around Rs 24,011 crore,” the report said. The year 2017 witnessed some large deals between institutional investors and Indian companies, with private equity investments in real estate touching USD 44 billion, according to the report. “We anticipate investment flows will continue on a healthy course.

This has been substantiated by the H1 data of 2018 with cumulative PE investments crossing USD 45 billion,” it said. Home sales velocity in the first half of 2018 rose by 25 per cent year-onyear, which according to the report can be attributed to returning buyers’ confidence on account of implementation of Rera in most states and stable capital values, which have started to show an upward trend. JLL India chief executive officer and country head Ramesh Nair said this has been the trend despite the fact that the Reserve Bank of India has increase the repo rate in its August monetary policy review, making home loans dearer. “As more and more developers register with Rera, we anticipate residential markets to pick up pace,” he added. The first half of 2018 saw corporate leasing activity rise by a 54 per cent year-on-year, driven by large technology companies, co-working, financial services and global in-house data centres. Companies leased around 24 million sq ft of office space in the first half, around eight million sq ft more than in H1 2017, according to the report. Bengaluru and NCR contributed the most to this growth, with a 26 per cent share each. “This trend… is a reflection of the current thriving business environment. Occupiers are not only inclined towards space take-up as part of their consolidation/relocation plans but also geared towards expansion-driven space strategy which points towards an upswing in the business cycle,” said Nair. In the retail real estate sector, net absorption rose over 75 per cent to 1.9 million sq ft in H1 2018.

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