Real estate in India witnessed the highest level of investment inflows in 2023 since 2020, according to real estate consultancy Colliers.

The inflows in 2023 were $5.4 billion, 10% higher as compared to 2022. The office sector continued to be the most significant contributor for 2023 with a 56% share in total inflows.

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As per the report, the leading sources of foreign capital in Indian real estate were Canada and Singapore accounting for 78% of the global real estate inflows into India during 2023.

Moreover, inflows from Asia-Pacific countries have been rising every year and have surged to 3.6 times in 2023 compared to 2020.

The second-highest inflows were witnessed in the industrial and warehousing asset class. As compared to $421.8 million in 2022, the inflows in the segment were up 108 per cent in 2023 at $877.6 million. This has been attributed to the expansion of the industrial sector, thriving on heightened consumption levels.

“Looking ahead to 2024, investment activity is likely to remain unabated backed by robust domestic economic fundamentals, while a strategic integration of technology and Environmental, Social, and corporate governance will play out in investment decisions,” said Piyush Gupta, managing director (Capital Markets & Investment Services), Colliers India.

With micro-fulfilment centres, dark stores and AI-driven supply chains becoming an integral part of the industrial & warehousing segment, foreign investments in the sector are expected to rise multi-fold in the next few years.

“As 2023 witnessed record-breaking office space leasing activity, global institutional investors remained committed to building office portfolios in India. Office-led investments had a commanding 56 per cent share in total real estate inflows in 2023. Along with envisaged momentum in alternative assets, industrial & warehousing, and residential sectors in the next few quarters, the office sector will continue to dictate India’s real estate investment ecosystem,” said Vimal Nadar, senior director and head of research, Colliers India.

The third-highest allocations were made towards the residential asset class. At $788-9 million in 2023, the inflows were 20 per cent higher as compared to $655.6 million in 2022.

In a separate report, Knight Frank said registration of properties in Mumbai municipal area is likely to rise by 33% annually to around 12,500 units during December.

As many as 9,367 properties were registered in Mumbai city, area under BMC jurisdiction, during the same month last year.

According to the data shared by the Maharashtra government, Mumbai’s real estate market reported 1,27,139 property registrations in calendar year 2023, marking 4% spike compared to 1,22,035 properties registered in 2022. As of December, 12,134 units were registered.