Institutional investments in Indian real estate hit record $8.5 bn in 2025

Colliers India said the December quarter alone saw $4.2 billion of investments, the highest ever in a single quarter, with domestic capital accounting for 57 per cent of annual inflows

Institutional investments in Indian real estate touched an all-time high of $8.5 billion in 2025, registering a 29 per cent year-on-year (Y-o-Y) growth, driven by record capital investment in Q4 of the calendar year 2025, according to Colliers India.

 

The last quarter alone saw $4.2 billion of investments, the highest-ever in a single quarter.

 

This new peak arrives at a time when the global economy is performing better, with signs of trade normalcy even in the midst of ongoing tariff negotiations. Additionally, India’s growth prospects and expanding investment horizons continue to reinforce its growing stature as a major destination for global capital across economic sectors, including real estate, the report noted.

   

Domestic institutional capital emerged as the primary driver of real estate investments in 2025, with inflows more than doubling Y-o-Y to $4.8 billion, accounting for 57 per cent of the total investment volume during the year. The strong growth in domestic investor participation underscores rising confidence among Indian institutional investors, supported by improving asset quality, stable returns, and greater market transparency.

 

Meanwhile, foreign capital investments in 2025 declined by 16 per cent Y-o-Y to $3.7 billion. However, the cross-border investments showed signs of recovery in the final quarter of the year, indicating a gradual improvement in global investor sentiment.

 

“During the year, office assets continued to attract the bulk of the investments, accounting for 54 per cent of the annual inflows, followed by residential and industrial & warehousing assets. Looking ahead, institutional investments are expected to strengthen further, supported by expanding domestic capital, improving global risk appetite, and India’s strong economic fundamentals,” said Badal Yagnik, chief executive officer & managing director, Colliers India.

 

The Indian office market received investments of $4.5 billion in 2025, almost twice the levels in 2024. The final quarter alone accounted for nearly two-thirds of annual capital deployment and coincided with strong grade A space uptake across the country's major office markets.

 

The residential segment followed the office segment with $1.6 billion of inflows during 2025, registering a 36 per cent Y-o-Y growth and accounting for an 18 per cent share in total investments.

 

Meanwhile, mixed-use, retail, and alternative assets also witnessed significant traction, cumulatively totalling about $1.5 billion and accounting for nearly 17 per cent of total investments in 2025. 

 

“The year also marked the listing of the fourth office-focused real estate investment trust (Reit) and notable acquisitions by older Reits, marked by superior tenant quality, higher occupancy levels, and strong rental growth. Looking ahead, with over 370 million sq ft of existing office stock having the potential to be included in future Reits, we anticipate a greater degree of institutionalisation and consolidation supported by cross-border capital flows over the course of the next few years,” said Vimal Nadar, national director & head of research, Colliers India.

 

City-wise, Bengaluru and Mumbai together account for nearly half of the real estate investments in 2025, with inflows of around $2.2 billion and $1.8 billion, respectively. Of the total $4.0 billion inflows in these cities, office assets drove close to three-fourths of the investment activity.