HYDERABAD: Anticipating a steady revival in the residential real estate market that suffered sluggish growth earlier, several global investors from Japan and Dutch are in talks to buy stakes in residential property ventures. The implementation of the the Real Estate Regulatory Act and lowering of interest rates by the RBI have infused renewed positive sentiment in the market, which will ultimately result in boosting demand for residential realty assets, say property consultants.
Property consultants say close on the heels of higher office-space absorption over the past couple of years, global investors are now finding the overall market sentiment for residential property segment attractive.
Top executives at property consultants told ET, seeking anonymity, that Korea-based Lotte group, Tokyo-based NIFCO, Dutch pension fund APG and a few Japanese investors were in talks with various Indian residential property developers.
“Lodha, Hiranandani and Shriram Properties are among the residential property developers who are currently in talks with various global investors including the Japanese and the Dutch entities that were evincing interest in Indian residential properties,” said a senior executive at a Mumbai-based global property consultant.
Puranik Developers raised Rs 300 crore from KKR for its residential project, while NIFCO invested $5 million in Shriram Properties’ residential projects. IIFL had invested Rs 500 crore in Mumbai-based Aristo Realtors.
Pennisula Brookfield and Incor Group jointly invested Rs 250 crore in a project being developed by IDB Group and Elco Holdings. Dutch pension fund APG had recently invested in Godrej Properties, while KKR, Blackstone, GIC and Xander are among those looking at opportunities in the residential realty space, said the executive.
“The interest of Dutch pension funds is a new trend being witnessed in the real estate sector as foreign investors have a cost advantage here, and they know the slowdown in the sector is not because of fundamental factors and that it is likely to show improvement soon,” says Rajeev Bairath, head of capital markets at Knight Frank.
Credits ET Realty