According to Knight Frank’s latest report, ‘Asia Pacific Horizon, Look Beyond the Norms,’ India ranked 5th in cross-border real estate investments in the APAC region, attracting 9% of the total volume of investment within the region in the first half of 2024.
The total cross-border investments in APAC during this period reached USD 11.5 billion, with India receiving USD 3 billion from global private equity investors.
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In terms of investment in Indian real estate, the office sector accounted for 36% of the total global capital allocation, reflecting the strong appeal of commercial real estate assets. The industrial sector followed closely with 30% of the investment share, while the residential sector received 15%, and retail accounted for 10%.
Shishir Baijal, Chairman and Managing Director, Knight Frank India, said, “The expected turnaround of global economies in the second half of the year is likely to encourage more foreign private equity players to take advantage of the country’s robust domestic macros. This influx of investment would boost the performance of Indian real estate and maintain the growth of industry assets.”
Cross-border capital flows are significantly shaping the commercial real estate landscape in APAC, driving the search for new investment opportunities. The anticipated rate cuts can further exceed a one-third increase in cross-border investments in the region in the second half of 2024, compared to the same period in 2023.
Among key gateway markets, Australia is likely to receive the highest volume of cross-border investments in H2 2024, marking a 129% increase from the previous year.
For the full year 2024, Australia, Japan, and Singapore are expected to be the top three destinations for cross-border capital, with estimated shares of 36%, 23%, and 11%, respectively.
Christine Li, Head of Research at Knight Frank Asia-Pacific and author of the report, said, “Historical analyses of previous crises, including the Global Financial Crisis, the Chinese economic slowdown, and the Covid-19 pandemic, demonstrate that transaction volumes in the region typically normalise within 30 months. Currently, we are in the 24th month of the high-interest-rate-induced downturn, suggesting the second half offers a prime investment window for undervalued assets. Early indicators of recovery are already observed in Australia and South Korea.”
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