Real Estate Sector Received $2.8 Billion FDI this Fiscal Year

The housing and real estate sector in India witnessed foreign direct investment (FDI) of $2.8 billion in the fiscal year (April-March) 2009-10, according to indian Department of Industrial Policy and Promotion. According to stats reavealed at IndiaHome property exhibition, which concluded in Dubai on Sunday, total NRI FDI inflows through the period April-December 2009-10 stood at $320.05 million. The housing and real estate sector including cineplex, multiplex, integrated townships and commercial complexes etc, attracted a cumulative FDI of $ 8.4 billion from April 2000 to March 2010, the department said.

Indian real estate is poised to enter an accelerated phase of growth in wake of international investors, the likes of US-based Warburg Pincus, Blackstone Group, Broadstreet, Morgan Stanley Real Estate Fund (MSREF), Columbia Endowment Fund, California Public Employees’ Retirement System (CalPERS), Hines, Tishman Speyer, Sam Zell’s Equity International, JP Morgan Partners and Amaranth Advisors, exploring investment opportunities in India. As per industry experts, overseas property sales account for 30 per cent of Indian real estate sector’s total global sales, of which, 40 per cent are accounted by the UAE-based Indians.

Growth is catalysed by the leading cities of India like Delhi, Mumbai and Bangalore, with capital values appreciating 2-5 per cent across the markets. Saru Kaushal, business manager mortgages of Citibank, which presented the IndiaHome exhibition, said that the property market growth of eight to ten per cent has attracted NRIs who want to invest part of their wealth back home in their first, second or retirement home. Townships and integrated-community developments have emerged as preferred investment destinations.

“One interesting thing is that all cities in India are developing with self sufficient localities within the cities so that residents do not have to travel long distances as they find residential, commercial and other facilities within close proximity,” Saru said. The leading real estate developers of India, pioneering the concept of integrated lifestyle community developments have found ready clients with the liquidity rich NRIs.

Harmit Chawla, vice president sales and marketing, Paras Buildtech India, said that supply runs far short of demand. He said that there were only 30,000 apartments ready in 12 months in Noida against the need for 70,000 apartments. Paras offered two projects at the exhibition, Paras Tierea and Paras seasons in Noida and a commercial project, Paras Trade Centre in Gurgaon. Traditionally, the Indian developers focused on the local market. Of-late developers are waking up to the huge potential of the untapped NRI market.

UAE based NRI’s are looking beyond the traditional Indian homes and prefer well-developed and maintained communities that offer modern amenities, leisure and entertainment opportunities within spacious and secure environs. Focus is to strike a balance between luxury and functionality.

Most of the visitors to the IndiaHome exhibition were looking for second homes, holiday homes and retirement homes while the ones looking at upgrading the living spaces of their parents back home, are equally conscious of security. IndiaHome property exhibition addressed specific needs of the UAE based NRI property investors. Effective in-person interaction platform with the representatives of top-notch developers, reputed for offering a global lifestyle and great living experiences, showcased the best residential opportunities available across India.