With equities losing charm, high networth individuals (HNIs) are asking their wealth managers to invets more and more capitals in more lucrative commercial assets.
At the current situation, stock markets are becoming more and more unpredictable and the real estate values have slumped in some cities.
So, the HNIs are buying more and more pre-leased commercial assets.
With the demand for office space growing up, especially by the IT/ITeS sector, office rentals have rebounded and are touching the 2007 levels.
Such pre-leased properties are yielding annualised returns of 10%-12%.
Earlier, HNIs used to invest in under-construction residential buildings. Now, they are moving away from such asset. They are now eying the real estate market that is witnessing a price correction in some parts of the country. This is happening due to some controversies surrounding land acquisition in some places like Noida.
Local real estate funds are also emerging as a preferred investment option for the HNIs.
Due to such controversies in the land acquisition process, the Reserve bank of India (RBI) has come out more stringent laws to regulate flow of funds to the real estate sector.
Banks have been directed by the apex bank to reduce their exposure to the real estate sector. But HNIs are pumping more and more funds in areas that are yielding more returns.
At the current situation, stock markets are becoming more and more unpredictable and the real estate values have slumped in some cities.
So, the HNIs are buying more and more pre-leased commercial assets.
With the demand for office space growing up, especially by the IT/ITeS sector, office rentals have rebounded and are touching the 2007 levels.
Such pre-leased properties are yielding annualised returns of 10%-12%.
Earlier, HNIs used to invest in under-construction residential buildings. Now, they are moving away from such asset. They are now eying the real estate market that is witnessing a price correction in some parts of the country. This is happening due to some controversies surrounding land acquisition in some places like Noida.
Local real estate funds are also emerging as a preferred investment option for the HNIs.
Due to such controversies in the land acquisition process, the Reserve bank of India (RBI) has come out more stringent laws to regulate flow of funds to the real estate sector.
Banks have been directed by the apex bank to reduce their exposure to the real estate sector. But HNIs are pumping more and more funds in areas that are yielding more returns.
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