India’s private equity (PE) landscape in the real estate sector witnessed a significant surge in deal value for the first nine months of FY25, even though the total number of deals dropped. Anarock Capital’s survey reports that while the number of PE deals decreased from 30 in the first nine months of FY24 to 24 in FY25, the overall investment value rose by 32.5%, reaching $2.82 billion. This growth was largely driven by high-profile transactions, particularly the Reliance-ADIA/KKR warehousing deal, which skewed the financial metrics.
The Reliance-ADIA/KKR deal, valued at $1.54 billion, was the largest transaction of the period, significantly boosting the logistics and warehousing sector, which captured 62% of the total investment, according to Shobhit Agarwal. Another notable transaction was Blackstone’s $204 million equity deal with LOGOS.
The period also saw a dominance of hybrid transactions, with hybrid deals accounting for 55% of the total deals. Debt transactions made up 24%, while equity deals comprised 21%. This shift in deal structures highlights the growing complexity of investment strategies in the Indian real estate market.
Multi-city deals, driven largely by the Reliance-ADIA/KKR deal and two other similar transactions, dominated the landscape, making up over 62% of the total deal volume. Cities like Bengaluru and Hyderabad led the charge, contributing 11% and 10% of the total deal share, respectively.
While debt and equity transactions remained relatively rare, the hybrid nature of the Reliance-ADIA/KKR deal remained the standout feature of this period. Both domestic and foreign investors maintained similar funding patterns as in previous years.
The industrial and logistics sector emerged as the clear leader in investment, capturing 62% of the total PE inflows. This outpaced both the office and residential sectors, which attracted 14% and 15% of investments, respectively. Despite strong leasing in India’s commercial real estate markets, PE activity in this space was subdued due to geopolitical uncertainties and high interest rates, which had a dampening effect on valuations. However, the sector’s robust operational performance is expected to continue, and a potential decline in interest rates could reignite PE investment in the coming months.
The industrial and logistics sector’s appeal remains high, driven by growth in manufacturing, e-commerce, consumer demand, and third-party logistics (3PL). The ongoing shift from Grade-B to Grade-A properties highlights a focus on quality, large formats, and environmental, social, and governance (ESG) considerations. Investor interest in warehouses is expected to stay strong, fueled by a steady supply of investment-grade properties and continued demand from institutional investors and high-net-worth individuals.
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