India ranked fifth in cross-border real estate investments in the APAC region, attracting 9 per cent of the total volume of investment within the region in the first half of 2024, a Knight Frank report said. Australia received the most at 36 per cent share, followed by Japan at 23 per cent.
Of the total cross-border investments of $11 billion in APAC in the period under review, India received $3 billion from global private equity investors.
The Indian office sector accounted for 36 per cent of the total global capital allocation, reflecting the strong appeal of commercial real estate assets. The industrial sector followed closely with 30 per cent of the investment share, while the residential sector received 15 per cent, and retail accounted for 10 per cent, the report said.
“The expected turnaround of global economies in the second half of the year is likely to encourage more foreign private equity players to take advantage of the country’s robust domestic macros, “said Shishir Baijal, Chairman and Managing Director of Knight Frank India.
The Chinese property market is still to revive from the crisis into which it has been plunged and received a tenth of the total flows to the region, the data showed.
Cross-border investments in APAC real estate are expected to rise by a third in the second half of 2024. The office sector is expected to attract 30 per cent of cross-border investments in 2024, followed by the logistics sector at 29 per cent.
Among key gateway markets, Australia is likely to receive the highest volume of cross-border investments in H2 of 2024, with an expected 129 per cent increase from the previous year. For the full year 2024, Australia, Japan, and Singapore are expected to be the top three destinations.
“Historical analyses of previous crises, including the global financial crisis, the Chinese economic slowdown, and the Covid-19 pandemic, demonstrate that transaction volumes in the region typically normalise within 30 months, “said Christine Li, Head of Research at Knight Frank Asia-Pacific.
She pointed out that currently the region is currently in the 24th month of the high interest-rate-induced downturn, which suggested that the second half of the year would offer a prime investment window for undervalued assets.