Indian Real Estate receives over $9 billion from Canada-based Institutional Investors

Institutional investors from Canada, along with various partners invest which is close to $9 billion into real Indian real estate and the current diplomatic row is unlikely to have any adverse impact on existing investments.

According to Mr.  Aashesh Aggarwal, Senior Vice President of ANAROCK Capital says that, “While the current political situation between India and Canada is concerning, we believe it is essential to focus on the long-term fundamentals that drive investment decisions. The Indian real estate market remains fundamentally strong, supported by a growing economy, urbanization, and increasing demand for housing and commercial spaces’’.

He further added that,’’ we do not anticipate any adverse impact on existing investments due to recent events. Investors recognize India’s potential as a key market and are likely to continue to engage positively, given the long-term benefits of investing in this dynamic economy’’.

According to the media reports despite rising diplomatic tensions between India and Canada, Canadian pension funds have so far remained committed to investing in India. The primary sectors are attracting Canadian pension funds infrastructure, renewable energy, technology and financial services.

As per the National Investment Promotion and Facilitation Agency (Invest India) ,Canada ranks as the 18^th largest foreign investor in India, with cumulative investments totaling $3.31 billion from 2020-21 to 2022-23. Canadian investments account for 0.5% of India’s total foreign direct investment (FDI), with services and infrastructure comprising 41% of these inflows.

According to a report titled, ‘Canadian Pension Fund Investments in the Asia-Pacific' ,from 2013 to 2023, approximately 57% of Canadian investments in India focused on real estate, financial services, and industrial transportation. Infrastructure and renewable energy sectors have gained ground.

Mumbai led the equity investment activity in Juyl-September ‘2024, along with Bengaluru and Chennai. Together with these three cities, has accounted for over 66% of total investments during this period, the report noted. During July-Sept’24, land/development sites dominated investments with a share of 45%, followed by the office sector with a 24% share. According to a report that shows the retail sector experienced resurgence in capital inflows, capturing around 22% share in the same quarter.