India amongst top 20 highest property investment market: Cushman & Wakefield

Date : Mar 12, 2015

India is amongst the top 20 investment destinations for 2014 with total of USD 5,000 million (mn). This was noted in the latest report by global real estate consultants Cushman & Wakefield entitled ‘International Investment Atlas 2015’. India also recorded the third highest growth in investments recording an increase of over 140% in total investment volumes in 2014 over the same time last year. The report however noted that global real estate investments fell in 2014 for the first time in five years, dropping 6.3% to US$1.21 trillion.

The India real estate investment scenario saw a high point in 2014 reaching highest investment levels in the last five years. In 2014 real estate investments registering a growth of over 140% over 2013, which was recorded at USD 2,100 mn.  There has been a sharp increase in corporate investment, which has seen a rise of over 280% over last year. Corporate investments were recorded at USD 2,550 mn in 2014 as against USD 900 mn in 2013.   

Residential emerged as the sector to receive the highest amount of investment totally upto USD 2,600 mn while office sector followed closely at approximately USD 2,000 mn. Of the total investment volume the domestic investments were recorded at USD 3,120 mn (62%)   and foreign at USD 1,930 mn (38%).

Sanjay Dutt, Executive Managing Director, South Asia, Cushman & Wakefieldsaid, “The huge growth in investment volumes in real estate markets in India are proof that investors are already acting out on their  expectations of improvements in the ease of doing business in India backed by regulatory reforms to be implemented by the Prime Minister Modi led government. We expect the investment volumes to increase even more and the volumes to touch levels found in the top 10 global investment destinations. Indeed, there is huge longer-term potential if the government addresses supply-side bottlenecks such as poor infrastructure to enhance India’s position as a global IT and outsourcing hub, as these could boost private investments (including foreign funds) and ensure all-inclusive growth for the entire population.

Global Investment scenario Market: This decline in activity can be solely attributed to a drop in Chinese land purchasing – however, most of the market is in rude health and set to improve further still in 2015, according to Cushman & Wakefield’s annual global capital markets report International Investment Atlas.  Indeed, the report forecasts global investment volumes to rise by 11% in 2015 to US$1.34 trillion, led by Europe and the US.

Asia Pacific (Including China Land Sales) underperformed in 2014 with a 23.6% fall in activity but it did at least end the year strongly, with volumes rising in Q4 for the first time in a year. According to Cushman & Wakefield’s annual global capital markets report International Investment Atlas, trends in Asia Pacific were very mixed-by-market however.  China led the way down thanks to a fall in land sales while Singapore, Hong Kong and Malaysia also saw sizeable falls but Australia, New Zealand, South Korea and India were all ahead. The report states that while excess capacity in some parts of the property market and past policy tightening impacted on Chinese investors and developers, excluding China land sales, global volumes rose 9%.  Asia in fact saw modest growth (1%) last year despite these and other tightening measures. Stripping out land, China was also up, rising 5% thanks to stronger retail and hospitality demand.  By sector across the region, offices were the only market to see a net gain for the year, mirroring their better performance in occupational terms. Other regions recorded stronger increases, with the Americas ahead 11.4% and Europe 11.8%.  Europe would have led the way more significantly had it not been for the strength of the US dollar. 

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