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Institutional investments in Indian real estate touched a remarkable USD 6.5 billion inflows in 2024, marking a substantial 22% increase from the previous year's USD 5.4 billion. This surge reflects strong investor appetite for Indian real estate and marks an annual high for both domestic and foreign investments since 2020.

The fourth quarter of 2024 was particularly robust, with investments totaling USD 1.9 billion - 2.3X times compared to the same period in 2023. This end-year momentum contributed significantly to higher investment volumes for 2024. Interestingly, domestic investments were significant in Q4 2024 and accounted for 43% of the inflows during the final quarter. This underscores the growing confidence of India-based institutional investors alongside sustained interest from international counterparts.

In 2024, the Industrial & warehousing segment accounted for the highest share in overall real estate investment volumes at 39%, surpassing the office segment. Manufacturing and industrial growth in the country was robust throughout 2024 and was reflected in the performance of macro-economic indicators such as Manufacturing Purchasing Manager’s Index (PMI) and Index of Industrial Production (IIP). At USD 1.1 billion, residential segment too witnessed substantial growth, rising 46% compared to 2023 levels. Overall, at USD 4.3 billion, foreign inflows continued to drive annual real estate investments at 66% share, while domestic investments too witnessed a steady rise, surging 27% YoY during the year.

“Private equity investments in Indian real estate have witnessed strong momentum in 2024 buoyed by robust domestic growth and sustained investor confidence. With a record USD 6.5 billion inflows in 2024, Indian realty investments have been the highest since 2020. Interestingly, APAC investors drove almost one-third of the foreign inflows in the country’s real estate during the year. Looking ahead, Tier-I cities will continue to attract majority of the capital, amidst government impetus on infrastructure development and ‘Make in India’ initiative. While global investors’ confidence is likely to remain upbeat, 2025 is likely to see increased capital deployment from domestic players across office, residential and industrial assets,” said Badal Yagnik, Chief Executive Officer, Colliers India.

Investment inflows (USD million) trend –

Industrial & warehousing investments in 2024 surge, 2.9X times compared to 2023

During 2024, institutional investments in Industrial & warehousing segment rose and were almost thrice the inflows in 2023. The segment attracted USD 2.5 billion investments, accounting for 39% of the total inflows, closely followed by the office segment at 36% share. Rising investments in the Industrial & warehousing segment is a testament to healthy domestic activity, enhancements in logistics efficiency, and India's improving capabilities as a global manufacturing hub. Foreign investments drove over 80% of the total inflows in the segment during the year.

"The year 2024, was a watershed year for real estate investments in India, wherein industrial & warehousing asset inflows surpassed annual investments in the office segment. With USD 2.5 billion inflows, large-sized deals drove industrial & warehousing investments in 2024. Rising demand for superior quality Grade A developments and evolving supply-chain models will continue to incentivise investors in consolidating industrial & warehousing assets in the country. Furthermore, manufacturing scale-up and healthy consumption levels are likely to attract domestic and global investments in both ready-to-use as well as developmental industrial assets, going ahead," said Vimal Nadar, Senior Director & Head of Research, Colliers India.

Despite subdued activity in the first few quarters of 2024, investments in the office segment picked up pace in the second half of the year. With USD 2.3 billion inflows, the segment accounted for a 36% share during 2024, and closely followed industrial & warehousing segment. Foreign investments accounted for about 77% of the inflows in office segment during the year. Additionally, residential assets too witnessed a notable growth during the year at USD 1.1 billion, witnessing a substantial 46% surge on an annual basis driven by sustained interest from domestic players.

Mumbai drove majority of the annual inflows, with 58% share in office assets

While multi-city deals corresponded to an overall 39% share, Mumbai, with about USD 1.6 billion inflows accounted for 24% of the real estate investments in the country during 2024. At 58%, office segment attracted majority of the annual inflows in the city on account of investment in select developmental assets. This was followed by industrial & warehousing assets which accounted for 20% of the real estate investments in Mumbai during 2024. Investment inflows in Bengaluru, Chennai and Delhi NCR also remained steady and accounted for 8-9% share each during the year.

City-wise investment inflows

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