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A notable upswing in investment activities within the real estate sector across the Asia Pacific region is anticipated in 2024, with India emerging as a key destination for capital inflows, as per a report by Colliers. Chris Pilgrim, Managing Director of Global Capital Markets, Asia Pacific at Colliers, expressed optimism for 2024, attributing it to substantial pent-up equity seeking investment opportunities. The report indicates a growing investment momentum, with major transactions expected to close in early 2024, leading to strategic moves in the second quarter and a subsequent surge in volumes from the third quarter onward. Colliers underscores India's prominence in this positive outlook, being one of the fastest-growing economies globally, fuelled by robust private consumption and capital formation. Investors are increasingly drawn to attractive opportunities in various segments of the Indian real estate sector, including office spaces, logistics, private credit, residential properties, and data centres. Foreign funds, in particular, are exploring significant markets in the region for potential investments, with India emerging as a net beneficiary. The office and logistics sectors in India have witnessed heightened institutional interest, predominantly from Canadian and Singaporean capital, transforming into a highly institutionalized market. In the initial nine months of 2023, Colliers reports a 27% year-on-year surge in institutional investments in the Indian real estate sector, totalling $4.6 billion, with foreign inflows constituting a dominant 77% share. The office sector attracted more than half of these investments, despite subdued activity attributed to the economic slowdown in developed nations. While the office sector experiences a slowdown, investors are increasingly directing their attention toward high-interest segments such as logistics, warehouses, and data centres. Colliers highlights that institutional investors are strategically capitalizing on India's data centre growth story, drawn by stable income, higher yields, and a supportive regulatory framework for this asset class. The report indicates a broader trend, with regional investors and funds increasingly including India in their underwriting strategies as part of a more extensive investment approach. This signifies a growing recognition of India's potential and the diverse opportunities it offers within the real estate landscape. In conclusion, the real estate investment landscape in the Asia Pacific region, particularly in India, is poised for a significant boost in 2024. The diverse appeal of India's real estate market, coupled with favourable economic indicators and regulatory support, positions the country as a key destination for investors seeking lucrative opportunities in various segments of the sector.
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