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Private equity (PE) investments in the Indian real estate sector reached $4.2 billion in 2024, marking a 32 per cent year-on-year (YoY) growth amid high demand in the warehousing segment, according to a report on Thursday. 

Knight Frank India, an international property consultancy firm, said in a report that the warehousing sector is leading the sector, which accounts for 45 per cent of total investments, followed by the residential sector at 28 per cent and the office sector at 26 per cent."

"Private equity investments more than doubled in the residential sector which saw a remarkable 104 per cent increase in PE investments, amounting to $1.2 billion in this year, demonstrating investor confidence in this segment which has been noting a consistent rise in end-user demand," the report mentioned.

Mumbai is the most favoured destination with 50 per cent of total PE investments in the city, driven by large volumes of investment in warehousing in the city, PE investment landscape in 2024, attracting $2 billion in 2024.

The warehousing sector dominated with 74 per cent of the total PE investments in Mumbai, amounting to $1.5 billion while the residential sector attracted $406 million, making up 20 per cent of the total PE investment in the city.

“Bengaluru received total PE investment $833 million in 2024. Around 52 per cent of these investments, amounting to $430 million, was towards the office sector, while the remaining 48 per cent or $403 million, was invested in the residential sector," the report added.

Shishir Baijal, Chairman and Managing Director of Knight Frank India, said that India has seen a rise in investments, particularly over the past decade, driven by economic stability and consistent growth.

“Propelled by the rise in e-commerce and third-party logistics, the warehousing sector emerged as the top recipient of investments, followed by the residential sector, which benefited from growing consumer demand,” said Baijal.