The Report charts the development of the Indian Real Estate sector since independence and says that we are in the fourth stage of evolution – one marketed by premiumisation, hybrid work, and consolidation – all smoothened by a push towards formalisation. These factors have increased the need for capital and created a nuanced funding ecosystem to cater to every cranny of the risk-reward matrix from the high risk-reward land acquisition stage to the low risk-reward lease rental discounting debt. Banks and equity markets supply a bulk of this funding, but some nooks remain where the role of alternates rises. NBFCs had hitherto filled these interstices, but post pandemic, their role has been taken over by AIFs. A second arena where the landscape has evolved is in providing exits and recycling capital. REITs have emerged as a hero in this space, with the ample REITable stock in the office market providing ample future opportunities. The Report concludes that expansion to different asset classes will be key to achieve heady growth. Finally, easing of regulations is given a salute, and the same has enabled dilution of stake in sponsors and rise of institutional stake over the years in REITs.
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