The fund is to invest in income generating assets such as malls, office complexes among others.
The global realty consultant attributed the rise in PE investments to increased attraction of institutional investors towards leased income generating office buildings.
Fortis Global Healthcare on Thursday said it has acquired a specialised under construction cancer hospital in Singapore from First Real Estate Investment Trust for a consideration of SGD 33 million (over Rs 115 crore).
Ace investor Rakesh Jhunjhunwala on Thursday said real estate developers are afflicted with very low return on capital as compared to bluechip stocks. Jhunjhunwala, who runs RARE Enterprises and is set to be a major shareholder in an upcoming airliner, said only the affordable housing developers can look at listing because of the volumes which they can deliver. It can be noted that very few developers like Macrotech Developers formerly Lodha, and DLF are listed on the bourses. Jhunjhunwala cited the case of DLF, saying the stock price plummeted to Rs 80 from Rs 1,300 per piece to illustrate the risks associated.
Lack of uniform valuation and disclosure standards could dampen the enthusiasm of investors in real state mutual funds once they are launched in the country.
The total number of unique investors directly investing in the stock market has surged to 80 million for the first time, with the latest 10 million additions taking place in just eight months, according to data shared by the National Stock Exchange (NSE), the country's largest bourse. "The 80 million unique PAN (permanent account number) investors correspond approximately to around 50 million unique households in India amounting to around 17 per cent households directly investing in the Indian stock market via NSE's extensive nationwide network of trading members," said the exchange. In 2021, the number of domestic households were pegged at 300 million.
Investors in Reit would like some favourable tax treatment so that this remains an attractive route for them to put money as compared to other options present in the market.
Deteriorating ties between India and Canada could have a bearing on flows into the domestic capital markets. At present, Canada is the seventh largest country for foreign portfolio investor (FPI) flows into India. According to the National Securities Depository Ltd (NSDL), the assets under custody (AUC) of FPIs domiciled in Canada stood at nearly Rs 1.8 trillion ($21 billion) at the end of August. Almost 85 per cent of these investments are in listed equity, while the remaining in debt and hybrid instruments.
Global realty funds eye India with $15 bn kitty
CapitaLand, the Singapore state-owned developer, is set to make one of the biggest bets by a foreign company on India's retail property boom, investing in 15 shopping centres worth S$2.1bn ($1.46bn) in association with two Indian construction and property groups.
Mittal will purchase 91 million common units of IPIT at the offering price that will be determined through a book building process, but would 'not be obliged to subscribe and pay' for any of the units if the subscription cost exceeds Singapore dollar100.1 million (about $73 million).
With Sebi clearing the final guidelines for creation of Real Estate Investment Trusts (REITs), assets worth around $12 billion are likely to be listed in the next 2-3 years.
Most players are looking to invest anywhere between $500 million and $1 billion in new ventures in the next couple of years, said experts on this segment.
Having completed the country's largest initial public offering of $2 billion (about Rs 8,200 crore), DLF Chairman K P Singh is getting ready to raise a similar amount in Singapore.
The regulator is more carefully scrutinising applications by infrastructure investment vehicles that have a limited number of investors. They have been asked to broaden their investor base before application approval, according to two people familiar with the matter. The Securities and Exchange Board of India is concerned about the structure being used for getting around tax requirements, according to one of the sources.
As real estate investment trusts (REITs) are set to become a reality in the country, small and medium property developers, who constitute 80 per cent of the total realty industry, can now breathe easy.
India's real estate industry staged a rebound from 2020's downturn, with housing sales seen rising by over 50 per cent. The performance, though short of pre-COVID levels, has property developers hoping for stronger gains in the New Year and the beginning of a long upcycle. A strong foundation has been laid this year for revival in the Indian real estate sector, which is projected to reach $1 trillion mark by 2030 from $200 billion in the pre-pandemic year.
Canada-based Brookfield will acquire the Indian business of American Tower Corporation (ATC) for an enterprise value of $2 billion, a release said on Friday. The transaction is subject to regulatory approvals and expected to close in the second half of 2024. "Data Infrastructure Trust (DIT), an Infrastructure Investment Trust sponsored by an affiliate of Brookfield Asset Management, today announced the signing of an agreement with ATC to acquire 100 per cent of equity interests in American Tower's operations in India (ATC India), for an enterprise value of Rs 16,500 crore ($2 billion) which is subject to pre-closing terms as per the securities purchase agreement," it said.
India has an urban housing shortage of about 18.7 million units, with 95 per cent of this shortfall in the low-cost housing segment, and 43.7 million in the rural belt.
The group also plans to nearly halve DLF's debt from Rs 13,958 crore to Rs 7,000 crore by the end of the current financial year by selling around Rs 5,500 crore worth of assets and raising Rs 2,000 crore from the DAL listing, said Singh. Wednesday's divestment will also help reduce DLF's debt by around Rs 1,500 crore since this amount will be given to DAL to repay part of the Rs 4,900 crore it owes the realtor, he added.
Credit outstanding to the housing sector rose by nearly Rs 10 lakh crore in the last two fiscals to reach a record Rs 27.23 lakh crore in March this year, according to RBI's data on 'Sectoral Deployment of Bank Credit'. Experts from banking and real estate sectors attributed this growth in housing credit outstanding to a strong revival in the residential property market post-COVID pandemic on pent-up demand. According to the data of the Reserve Bank of India (RBI) on sectoral deployment of bank credit for March 2024, the credit outstanding to the housing (including priority sector housing') stood at Rs 27,22,720 crore in March 2024, up from Rs 19,88,532 crore in March 2023, and Rs 17,26,697 crore in March 2022.
The Sebi chief said that although the idea of an SRO has been challenged in court, he is hopeful of its implementation.
'Many of the challenges of investing in commercial real estate get taken care of when an investor takes the Reit route,' points out Suraj Nangia.
Blackstone has bought A Wing and some part of B Wing of the building, which has three wings with a total area of 1.5 million square feet.
Global investment firm Blackstone on Wednesday sold its entire 23.5 per cent stake in Embassy Office Parks REIT for around Rs 7,100 crore, according to sources. Embassy Office Parks REIT is India's first Real Estate Investment Trust (REIT) sponsored by Blackstone and Bengaluru-based realty firm Embassy group. Blackstone sold its stake in the entity at around Rs 316 per share through open market transactions and at this price, the deal is valued at about Rs 7,100 crore, the sources said.
The real estate sector is a major employment provider and the economy cannot afford its hard landing. Harsh Roongta suggests measures that can revive the under-construction market
15 to 25 per cent of property registrations in Mumbai come from redevelopment, with over 3,500 projects approved by May 2024.
Industry players estimate the average payouts to be in the range of 50-75 per cent of the bankers' annual salaries. For the top performers, the bonuses could be 100-125 per cent.
While sale of residential properties increased only marginally despite plethora of steps taken by the government through the year, office space leasing rose 40 per cent to touch an all-time high of 46.5 million sq ft -- a trend that drew investors to lap up India's first Real Estate Investment Trust at an issue size of nearly Rs 5,000 crore.
The proposed tax exemptions and benefits notwithstanding, these new investment instruments would still be 'revenue accretive' for the government in the form of additional taxes.
On the individual front, housing loan rebate on self-occupied property was increased from Rs 1,50,000 to Rs 2,00,000.
A host of dynamic reforms, policies and announcements during the last five years are expected to reach its logical fruition in the second term, says Ankit Kansal.
From liquidity, monetary policy operations to financial inclusion, know about RBI monetary policy
Reliance Industries, construction major L&T and IRB Infrastructure are some of the top companies that have used an infrastructure investment trust structure to reduce part of their debt and generate returns for their investors. Earlier this month, IRB Infrastructure InvIT was listed on the National Stock Exchange, giving its investors an option to exit by selling their units. The listing came within months of the Securities and Exchange Board of India's (Sebi's) guidelines for conversion of private unlisted InvITs into listed ones were issued.
Aggressive acquisitions & deep pockets fuel real estate competition; experts suggest future partnership
Swaraj said the focus of the government is growth with eye on manufacturing, infrastructure and trade
With a stable government at the Centre and the a renewed sense of confidence among the industry, there is expectation that there will be more demand for office space.
Another major development is REITs coming closer to reality
Raghavendra Kamath reports on what ails India's real estate sector.
U K Sinha's six-year tenure as chairman of Securities and Exchange Board of India ends later this week. Sinha held his last press conference in Mumbai on Monday, where he spoke on wide-ranging issues and his biggest regret.
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