Institutional Investments Skyrocket in India's Real Estate

Institutional investments into India’s real estate sector have surged to $1.80 billion in the second quarter of 2025, marking a sharp 122% rise over the previous quarter, according to a new report by real estate consultancy firm Vestian.

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Foreign Investors Lead the Charge

The rebound was led largely by foreign investors from the US, Japan, and Hong Kong, who collectively accounted for around 89% of the foreign inflows, primarily targeting commercial assets.

A Cautious Outlook Among Investors

Despite the impressive quarterly rise, the report noted that the inflows were still down 42% year-on-year from the highest-ever quarterly investment recorded in the same period last year. Foreign investments contributed $1.19 billion of the total, representing a 46% annual drop.

Commercial Real Estate Dominates

Commercial real estate attracted the major share of institutional capital in Q2, while residential properties accounted for only 11% of the total inflows. The remaining investment was directed towards diversified asset classes.

Domestic Investments Subdued

On the domestic front, investment activity remained subdued. Domestic investors contributed just 19% of total institutional investments, compared to 21% a year ago.

Future Outlook

Despite these challenges, the report sees scope for continued capital inflows in the coming quarters, particularly if macroeconomic indicators remain stable and supportive policy measures continue.