NCR’s real estate market has emerged out of its shadow period, says Credai-NCR president 

NCR real estate may have finally emerged out of its shadow period with increased interest among investors in the micro-market showing a U-turn in terms of the credibility of the realtors.  

With a slew of projects battling insolvency and homebuyers struggling to get their homes, the market has been battling to reestablish a positive perception among investors. However, realtors think that the ‘dark phase’ of NCR real estate is almost over. 

Manoj Gaur, Vice President, Credai National (North India) and President, Credai NCR told BusinessToday, “NCR realty is now on strong footing. Post-pandemic only serious players are present in the market as the non-serious players have already left. There is a good demand-supply balance and most builders currently involved are financially stable. The pandemic has acted as a real test for NCR realty. By now, only a few troubled projects from the pre-Rera time are left for completion and resolution. The dark phase is over. The market is being driven by strong end-user demand and that’s driving sales. This trend will be in place all through 2023.”  

Private equity funding in NCR real estate has zoomed in 2022, Anarock’s Capital’s Flux 9M FY23 report showed. The report revealed that PE players invested USD 1,215 Mn into NCR the first nine months (9M) of FY23, against USD 771 Mn in the corresponding period in the previous financial year. This was a 58 per cent yearly jump in total PE inflows in the region. 

Nayan Raheja of Raheja Developers told Business Today, "After Mumbai Metropolitan Region (MMR), NCR is the country’s second most prominent real estate market. However, post-pandemic, it has performed exceptionally well and witnessed a sizeable investment, including that private equity funding. The region comprises areas from three states – Delhi, Uttar Pradesh and Haryana. There is a vast parcel of available land, and the respective state governments are pro-actively pursuing enlightened policies. Besides, they are undertaking big infrastructural development projects that can turn the region into industrial, business, commercial, corporate, and investment hubs. For the PE funds, the ROI, both in the medium and long term, will be huge."

Sanchit Bhutani, Managing Director, Bhutani Grandthum added, "NCR is in the middle of a significant leap. The opening of new avenues, massive improvement in all-around connectivity, and most significantly, the construction of the upcoming international airport at Jewar, have brought the region into the limelight and have acted as a catalyst in real estate development in the NCR. The area exhibits a vast growth potential and has received a significant quantum of private equity funding. PE funds, especially in the commercial segment have led to higher returns on the investment and we expect this trend to continue growing in 2023 as well."

Ten deals across India accounted for 76 per cent of the total value of PE investments in the nine-month period of FY23 concluded in December. As compared with 72 per cent in the first nine months of FY22. The average deal ticket size rose from USD 82 MN in 9M FY22 to USD 91 MN in 9M FY23. 

Tata Realty and Infrastructure (TRIL) bagged the maximum capital provided by CPPIB at USD 700 million in equity funds for projects in multiple locations. Bharti Enterprises received USD 660 million in equity funds from Brookefield. Shapoorji Pallonji bagged USD 194 as debt funds from HDFC Capital Advisors for multiple residential projects.