Private equity investments in the real estate sector stood at ₹15,410 crore in 2014, up from ₹7,360 crore recorded in 2013, according to real estate consultancy Cushman & Wakefield.

This is also the highest level of investment since 2008 (₹17,440 crore), indicating renewed interests among domestic and foreign investors for the Indian real estate sector. The year 2014 saw high level of interest in leased office assets with a number of foreign investors acquiring IT parks and IT-SEZs. Investment activity in under-construction projects in the residential segment also improved significantly.

Sanjay Dutt, Executive Managing Director South Asia, Cushman & Wakefield, in a statement, said: “Aggressive acquisitions by foreign funds in the Indian real estate assets in 2014 is an indicator of renewed interest in the sector. With increasing capital requirements of the Indian real estate sector and in anticipation of improving macroeconomic conditions, private equity funds are likely to invest even more in the next few years.”

Delhi tops the list Delhi-NCR witnessed the highest level of transaction activity in 2014 with investments of ₹5,910 crore, nearly four times the quantum of investments in 2013.

Given the liquidity issues faced in the residential segment as developers saw subdued sales and highly restricted access to debt funding, private equity funds have emerged as an important source to meet funding requirements.

A few fund houses have now tweaked their strategy and are collaborating directly with residential developers (to garner higher returns). Some funds are underwriting apartments in under-construction residential projects.

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