Foreign investor interest grows back in india
The volume of investment has increased from USD 134 million to USD
184 million indicating a rise in confidence for indian real estate
as well.
India-specific cumulative fundraising attained its peak in the pre
global financial crises (GFC) period. During this period between
2005 and 2008, there were 50 such funds that raised USD 16 billion
in total. However, post-GFC,only 29 funds got raised in five years
with cumulative fundraising of only USD 3.9 billion.
The cycle started gaining momentum again just before the 2014
general elections on the hopes of a Modi-led government coming to
power at the centre. USD 2.2 billion has been raised so far in the
current investment cycle.This shows a definite rise in confidence
for indian real estate.
Not only has the volume of investment increased but there has also
been an increase in the average ticket size from USD 134 million
to USD 184 million. This shows how investors turned positive towar
-ds india post Modi becoming the prime minister.If investment done
in USD alone is considered,the average ticket size has gone up
from USD 159 billion in 2009 13 to USD 388 billion in the ongoing
phase that started in 2014.
Foreign investments flowing
During the pre-GFC phase,82% of funds got raised in USD. This
reduced to 57% in post-GFC phase when the going got tough and mic
-cro-market understanding was required more than banking on the
macro-economy alone.The contribution,2014-onwards,has increased
considerably to 70% hinting that the positively is here to stay
for some time.
These changes reflect how foreign investor participation rises
when the economy is moving up but when the tide turns, it's the
domestic investors with familiarity of developments in micro-mark
-ets that increase their focus on investment.