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Private Equity Fuelling Commercial Realty Boom In India, Says Anarock Consultants

Private equity players striking bigger deals and potential benefits of Real Estate Investment Trusts is aiding the growth in the commercial real estate sector, according to Anarock Property Consultants.

“The leasing (demand) of office spaces was way ahead of the supply last fiscal, and 2018 was the best-ever year as 40 million square feet was leased in India,” its Chairman Anuj Puri told BloombergQuint. “The private equity segment is seeing Real Estate Investment Trusts as a credible medium to exit from the investments they are doing and thereby they can make profits.”

Private Equity Fuelling Commercial Realty Boom In India, Says Anarock Consultants

Embassy Office Parks REITs opened the country’s first such offering this month and the issue was fully subscribed, led by the demand from retail investors. REITs are mutual fund-like listed instruments that pool in income-generating assets and allow investors to take exposure in real estate without physically owning it. India cleared such trusts in 2015 but the first public offer comes about four years later after several tweaks to the original rules.

Around $4 billion was invested by private equity in office spaces last year. Apart from private equity, sovereign funds, pension funds and also insurance funds are getting into this space.
Anuj Puri, Chairman, Anarock Consulting

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