Hyderabad ranks among top five cities in India, with USD 2.24 bn investment in real estate during 2018-22

Hyderabad with the closure of 24 land deals and the acquisition of 970 acres of land, saw investments totalling USD 0.9 billion during 2018-22 into land/site acquisition.

Hyderabad: Between 2018 and 2022, Hyderabad attracted USD 2.24 billion of equity investments into the real estate sector accounting for 7 per cent of the cumulative investments in India.

According to the findings of ‘Indian Real Estate: Betting on a ‘Capital’ Future’ released by CBRE South Asia Pvt. Ltd., on Tuesday, Hyderabad with the closure of 24 land deals and the acquisition of 970 acres of land, saw investments totalling USD 0.9 billion during 2018-22 into land/site acquisition.

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The city also recorded second highest land acquisition activity in the country, accounting for over 14 per cent of the total land acquired since 2018. At a pan-India level, according to the report, overall investments in the RE sector between the period 2018-2022 stood at USD 43.3 billion. Equity investments over this period stood at USD 31.8 billion while debt investments were USD 11.5 billion.

The CBRE report points out that majority of the capital deployment made since 2018 has been through core and core-plus investment strategies. However, the city has been witnessing a growing number of bets being made through opportunistic route for Greenfield developments.

Institutional investors leading the inflows in India:

According to the report, cross-regional investors (outside APAC region) pumped in nearly 47 per cent of overall investments in India since 2018. Domestic investors (mainly real estate developers) have invested over USD 13 billion, accounting for around 42 per cent of the total investments during this period.

More than USD 17 billion have been invested by institutional investors over the past five years, with North American investors continuing to make up most of these investments.

Sectoral Bets:

The office sector received more than 56 per cent of institutional inflows and pent-up demand and an improvement in employee occupancy levels in business parks, drove a solid rebound in office leasing.

Acquisition of site/land parcels was another preferred bet, with total institutional inflows being recorded at over USD 2.5 billion, representing a nearly 15 per cent share. Retail got over USD 2.0 billion in capital infusion, or more than 11 per cent of total institutional investments.

Anshuman Magazine, Chairman & CEO – India, South-East Asia, Middle East & Africa, CBRE, said, “Over the next two years, we expect investment flows to remain steady with cumulative inflow of USD 16-17 billion.”

Gaurav Kumar and Nikhil Bhatia, Managing Directors, Capital Markets and Residential Business, CBRE India, commented, “Sustained demand across all sectors combined with stellar returns has led to an influx of new investors who are looking to set up large investment platforms in the country.”

Rami Kaushal, Managing Director, Consulting & Valuation Services, India, Middle East & Africa, CBRE, added, “REIT landscape is expected to get more diverse this year as we may soon see the listing of India’s first retail REIT, which could add more depth to the REIT market in India.”

Investments in site across top seven cities (2018-2022)

City Land Acquired (acre) Land Deals Investment (in USD bn)

• Delhi-NCR 1760 67 3.8
• Mumbai 960 73 3.8
• Bangalore 700 44 1.1
• Hyderabad 970 24 0.9
• Chennai 500 47 0.9
• Pune 450 27 0.6
• Kolkata 110 4 0.1