Mumbai, which is facing a torrent of obstacles in its bid to become an international financial centre (IFC), seems to have some good news at last. It has eased out Chennai as India’s most attractive tier-I city for real estate investment, according to a survey conducted by Jones Lang LaSalle Meghraj (JLLM).

The study, Accelerated Transformation: Investments in Indian Real Estate, which analyses investment trends in the fourth quarter of 2007 and will be released soon, places the Delhi-National Capital Region (NCR) fourth in the list of five tier-I cities with Chennai, Bangalore and Hyderabad getting the second, third and fifth spots respectively. Kolkata has topped the list among tier-II cities while Nagpur is the most preferred tier-III investment destination, according to the report.

Commenting on the country’s financial capital regaining the pole position, Redford Capital director Parry Singh said, “Mumbai has a lot of potential in terms of redevelopment projects. Areas like Virar, Borivilli, Panvel and Navi Mumbai can be used for fresh development.”

Jones Lange LaSalle-Meghraj Knowledge Center head Tanaji Chakrabarti pointed out, “The factors that have contributed to Nagpur’s ranking are its central location and the development of the city’s multi-product international hub airport.” Two-thirds of the nearly 150 private equity funds currently operating in the country fall in the active category. “These funds are focusing on better quality of investments across tier-II and III cities rather than quantity. Many real estate funds have moved ahead in the transaction cycle, from sourcing and evaluating deals to concluding and implementing transactions,” Chakrabarti added.

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