WEF India Economic Summit 2019: Indian Real Estate Only Has Balance Sheet Problems, Says Investcorp
Investcorp has already invested $200 million in the country’s real estate space.
India’s real estate sector still has huge pent-up demand and their problems at the balance sheet level could be fixed with extending quality finance to developers. That’s according to Investcorp’s Rishi Kapoor.
“The fundamentals of the real estate sector, particularly the residential housing space, is pretty solid,” said Kapoor, co-chief executive officer of the Bahrain-based alternative investment fund, told BloombergQuint at the WEF India Economic Summit 2019. “There is a lot of pent-up demand from middle-income families looking to purchase their own home. There is a scarcity of efficient financing for developers.”
India’s real estate sector has been facing liquidity crunch since the payment defaults by Infrastructure Leasing & Financial Services last year. This led to a pile-up of unsold apartments. Last month, Finance Minister Nirmala Sitharaman announced the government’s plan to create a Rs 20,000-crore fund to provide financing to many stalled housing projects.
Investcorp has already invested $200 million in the country’s real estate space and seeks to help companies only at the individual project level and not invest in companies as a whole. “We are evaluating to invest in the commercial real estate space but the initial focus for us is the mid-market housing,” Kapoor said.
Other Highlights:
- Plan to invest in single-speciality healthcare services such as eye care, dialysis.
- Quality healthcare at affordable prices is a bankable thesis in the long run.
- Best business opportunities are those sectors where there is a big supply-demand gap.
Watch the full interview here: