Indian real estate getting stabler

Well, the New Year – 2010 has kicked off already and hence, an assortment of speculations is in the air, especially regarding the Indian realty sector. What is in the future? How will the Indian real estate sector behave in the upcoming months? These thoughts are getting more importance than ever before and the reasons are not hard to see. The Indian realty sector did undergo a severe jolt thanks to the global recession and the atypical deeds of it (at that juncture) are still fresh.

Nonetheless, Indian realty captains have reasons to laugh. It is getting more and more evident that the Rs 70,000-crore Indian real estate sector is on the verge of witnessing fresh investments to the tune of $1.5 billion in residential deals under the aegis of exclusive real estate funds in the financial year 2010-11. As per industry analysts, this is three times more than the total quantum that such funds invested in FY 2008-09.

These funds include Sun Apollo, HDFC India Real Estate Fund, RedFort Capital, ICICI Prudential Infrastructure Fund and Xander Real Estate Partners. It has come to the knowledge that the investments will be both in the metros in addition to Tier II cities in India and we can certainly be hopeful of a revitalization and bright future.

However, there is another development. Both international funds and domestic real estate funds will play equal roles and there might be a healthy competition between the two concerning the contributions. Domestic real estate funds may lead to overall investments of around $400 million, international funds are likely to deliver forth in excess of $1.2 billion in the real estate sector during the period.

Speaking to Financial express of late, Amit Goenka, National Director - Capital Transactions, Knight Frank India Private Ltd said, “These estimates are based on the total active domestic and international funds and their existing corpus strengths. There are some active domestic players like HDFC, ICICI Prudential Fund, IndiaREIT, Milestone and ASK who are expected to do deals in 2010. The bulk of the funds are, however, foreign, with much larger corpuses.”