In the backdrop of sustained caution among Non-Banking Finance Companies (NBFCs) with their exposure to real estate, private equity firms are emerging as the largest source of funding to developers. The liquidity gap that has been created by NBFCs going slow on investing in new assets has provided private equity players a robust pipeline of real estate project financing transactions. Private equity firms have invested $1.80 bn across 20 deals between October and March. However, given the rise in risk perception and paucity of capital, private equity firms are also filtering their options well before making any financial commitments, and this has increased their return expectations as well.

(Economic Times)