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NEW DELHI: Private equity (PE) investments in the Indian real estate sector rose sharply to USD 2.4 billion (₹203 billion) during the first half (H1) of 2025, marking a 38% year-on-year (YoY) growth, according to a report by Savills India.
The momentum accelerated in the April–June quarter (Q2 2025), with investment inflows doubling sequentially to USD 1.6 billion (₹139 billion), buoyed by strong investor appetite for commercial office assets, hospitality, and alternative segments like student housing.
“There is a clear strategic shift towards portfolio diversification. Segments such as retail, hospitality, and student housing are increasingly drawing investor attention, reflecting the market’s maturity and resilience,” said Sumeet Bhatia, managing director (Capital Market Services), of the company.
Commercial and alternative assets lead investment activity
Commercial office assets accounted for approximately 31% of the total investment volume in Q2, maintaining their position as the dominant asset class. However, investor sentiment showed a marked shift toward high-growth potential in alternative real estate segments. Hospitality and student housing collectively captured 16% of the quarterly investment share, with hospitality alone contributing 15%.
Land emerges as a key investment avenue
Land transactions surged during H1 2025, contributing 40% of total PE inflows—significantly higher than 13% in full-year 2024 and 26% in 2023. Mumbai remained the top destination for land deals, commanding nearly 70% of land-related investments during the first half of 2025.
Foreign capital remains dominant
Foreign institutional investors continued to dominate India’s private equity landscape in real estate, accounting for 76% of total inflows during H1 2025. This reaffirms global confidence in India’s economic and urban infrastructure trajectory.
Top deals highlight diversified investor focus
The largest deal in Q2 2025 was Blackstone’s USD 378 million investment in South City Mall, Kolkata—a major retail-focused transaction. Additionally, Sumitomo invested USD 295 million and Brookfield pumped in USD 151 million into MMRDA assets in Mumbai, underscoring a strategic alignment with India’s infrastructure-driven urban growth.
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