Are global funds looking closely at India’s CRE
Institutional capital into Indian real estate reached a new high in 2024, with equity investments totaling US$11.4 billion, according to CBRE’s year-end monitor. This represented a 54 percent year-on-year increase, reflecting renewed interest in built-up office assets and a significant rise in land acquisitions for future development. Contrary to earlier claims that foreign funds made up two-thirds of the total, the data show that domestic investors led the way, accounting for about 70 percent of equity inflows. Foreign capital remained significant, but secondary, with Singapore, the United States, and Canada among the largest sources.
Momentum has carried into 2025, although at a more selective pace. In the second quarter of this year, institutional inflows were about US$1.7 billion, a 29 percent rise compared to the first quarter. However, the figure was about a third lower than the same period in 2024, reflecting tighter global liquidity and slower decision-making by international investors. Office assets continued to attract the largest share of private equity interest during the first half of the year, demonstrating the resilience of institutional-grade office demand even in a cautious investment environment.
Large global managers remain active in high-profile transactions. Blackstone completed the acquisition of South City Mall in Kolkata in June 2025 for ₹3,250 crore, one of the most significant retail deals of the year and among the largest real-estate foreign direct investment transactions in Bengal. CapitaLand Investment, based in Singapore, has separately announced plans to double its exposure in India to more than US$14.8 billion by 2028, underscoring long-term confidence in the country’s commercial real estate markets.
These inflows are supported by India’s macroeconomic fundamentals. The economy continues to post robust growth, with GDP expanding by 6.5 percent in FY2024–25 and by 7.8 percent in the first quarter of FY2025–26, according to government estimates. Policy initiatives such as the Production-Linked Incentive scheme have also begun to shift from planning to implementation. By March 2025, realized investments under the PLI framework had reached ₹1.76 lakh crore across fourteen sectors, supporting manufacturing growth and boosting demand for logistics and industrial real estate.
The occupier side of the market also reflects these shifts. CBRE’s mid-year figures show that industrial and logistics leasing reached a record 27.1 million square feet in the first half of 2025, driven by demand from third-party logistics and e-commerce operators. Office absorption has been supported by the continued expansion of Global Capability Centres and the broader return-to-office trend in India’s major metropolitan areas.
The idea that global investors are “doubling down” on Indian commercial real estate is directionally supported by marquee transactions and multi-year commitments, but the data indicate a more nuanced picture. Foreign capital is indeed strategic and long-term, but it was domestic players who led overall inflows in 2024, and investment activity in 2025 has been more selective than the headline figures suggest. Quarter-on-quarter growth points to resilience, but the year-on-year declines highlight the headwinds of higher global interest rates and a cautious deployment environment.
Nevertheless, the focus areas remain clear. Core and core-plus offices in established markets, industrial and logistics assets linked to India’s expanding supply chain, and platform-style partnerships that align with REIT structures and regulatory clarity continue to attract both domestic and foreign institutions. With macro stability, policy support through PLI and infrastructure spending, and long-term commitments from global managers such as Blackstone and CapitaLand, India remains one of the most attractive emerging markets for commercial real estate investment—provided that investors and developers can navigate financing costs, regulatory approvals, and disciplined project execution.
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