India is emerging as a promising destination for long-term real estate investment, said David Steinbach, global chief investment officer at Hines, a US-based real estate investment manager. In an interview with Kailash Babar, Steinbach discusses how demographic trends, policy reforms and evolving market fundamentals are shaping India's real estate landscape. Edited excerpts:
What makes India a strategic focus for Hines in today's global investment climate?
Despite the broader macroeconomic uncertainty, we continue to view private real estate as a high-conviction investment, given its tangible nature and historical resilience amid higher-for-longer environments, and India is no exception. India presents a combination of scale, relative stability and domestic demand that stands out in today's de-globalising environment. We're seeing the global economy undergo structural shifts, such as supply chain reconfiguration and capital bifurcation, which are influencing how and where capital is deployed, which we believe could provide tailwinds for India. One outcome of these shifts could be capital staying closer home, meaning investors in Asia may be keener to invest within the region. That, paired with the fact that intra-regional trade in Asia is mature, could bode well for India in the long-term.In this context, India's rising consumption and urbanisation, supported by policy reforms, has offered a foundation for long-term real estate investment that appeals to many investors. Since launching our India platform in 2006, we've seen that local execution and strong partnerships have been essential to succeed. As global capital becomes more selective, India presents a market where fundamentals should support long-term deployment strategies.
How does India's private real estate market compare with global trends?
India's private real estate market has demonstrated resilience across various property types, including living, office, industrial and retail sectors. While construction activity has slowed in many global markets due to cost pressures and uncertainty, India has continued to show demand across all asset classes so far, especially office.Office rental yields in major cities have remained competitive, and the office sector has seen steady absorption. Our research indicates that India just saw a record second quarter for total leasing in the office sector, as tech and manufacturing firms continue to expand their footprint there or upgrade to newer, cutting-edge space. These trends suggest that performance has been driven more by fundamentals than sentiment.
What sectors is Hines focused on in India?
We're focused on sectors and geographies where fundamentals are strong and long-term demand is evident. The office sector in India has been an outlier with both domestic and international companies, as well as global capability centres and innovation hubs, contributing to sustained demand for high-quality space. Living also presents a significant opportunity, given a lack of institutional quality properties and a growing need for more housing, especially in dense urban areas.
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What makes India a strategic focus for Hines in today's global investment climate?
Despite the broader macroeconomic uncertainty, we continue to view private real estate as a high-conviction investment, given its tangible nature and historical resilience amid higher-for-longer environments, and India is no exception. India presents a combination of scale, relative stability and domestic demand that stands out in today's de-globalising environment. We're seeing the global economy undergo structural shifts, such as supply chain reconfiguration and capital bifurcation, which are influencing how and where capital is deployed, which we believe could provide tailwinds for India. One outcome of these shifts could be capital staying closer home, meaning investors in Asia may be keener to invest within the region. That, paired with the fact that intra-regional trade in Asia is mature, could bode well for India in the long-term.In this context, India's rising consumption and urbanisation, supported by policy reforms, has offered a foundation for long-term real estate investment that appeals to many investors. Since launching our India platform in 2006, we've seen that local execution and strong partnerships have been essential to succeed. As global capital becomes more selective, India presents a market where fundamentals should support long-term deployment strategies.
How does India's private real estate market compare with global trends?
India's private real estate market has demonstrated resilience across various property types, including living, office, industrial and retail sectors. While construction activity has slowed in many global markets due to cost pressures and uncertainty, India has continued to show demand across all asset classes so far, especially office.Office rental yields in major cities have remained competitive, and the office sector has seen steady absorption. Our research indicates that India just saw a record second quarter for total leasing in the office sector, as tech and manufacturing firms continue to expand their footprint there or upgrade to newer, cutting-edge space. These trends suggest that performance has been driven more by fundamentals than sentiment.
What sectors is Hines focused on in India?
We're focused on sectors and geographies where fundamentals are strong and long-term demand is evident. The office sector in India has been an outlier with both domestic and international companies, as well as global capability centres and innovation hubs, contributing to sustained demand for high-quality space. Living also presents a significant opportunity, given a lack of institutional quality properties and a growing need for more housing, especially in dense urban areas.
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