PE Inflow Into Real Estate Tumbles 44% To $3 Billion In 2023: Knight Frank

Global investors have been cautious this year to put money into Indian real estate as private equity inflow dropped 44%, according to property consultant Knight Frank.

The Indian real estate market received $3.0 billion in PE investments from 23 deals between Jan. 1 and Dec. 12 this year against $5.36 billion in 2022, Knight Frank India data released on Thursday showed.

Global geopolitical uncertainties and a high interest rate environment with multiple rate hikes from the U.S. Federal Reserve and the Central Bank of Canada have curbed investment activities from the two nations, the consultant said, explaining the reason behind the slump.

However, PE investments from Singapore have improved significantly, contributing more than 50% to the total inflow.

Office assets took the lead with a 58% share, followed by warehousing at 23%, and residential properties at 19%. The retail sector did not witness any PE deals in 2023.

Across the segments, Mumbai received the largest proportion of such investments at $1.69 billion, followed by the National Capital Region at $835 million, and Bengaluru at $347 million.