Commercial Real Estate Drives Investment in India: Q2 2023 Report
The commercial real estate sector in India saw a significant boost in the April-June period, accounting for 62% of total investment. This trend is supported by the growing momentum in Small and Medium Real Estate Investment Trusts (SM REITs).
Commercial Real EstateInvestmentSm ReitsInstitutional CapitalReal Estate MarketReal Estate NewsJul 15, 2025
The quarter saw 17 transactions worth $1.3 billion, including IPOs and QIPs. Excluding public market activity, 13 deals were valued at $775 million. The report highlights the growing momentum in the Small and Medium Real Estate Investment Trusts (SM REITs) segment, with fresh registrations indicating broader public market access for mid-sized developers.
Shabala Shinde, Partner and Real Estate Industry Leader at Grant Thornton Bharat, noted, “With SM REIT momentum building and India’s largest-ever REIT issue expected in H2, the sector enters the second half of the year with cautious optimism and an institutional focus.” The January-June (H1 2025) period reflects a sector recalibrating for long-term strength in the real estate market in India.
While overall deal values moderated, institutional capital continues to flow steadily into commercial platforms, reinforcing the asset class’s resilience. The return of IPO and SME REIT activity, alongside anticipation of India’s largest REIT, signals that capital markets are gearing up to play a larger role in driving real estate growth.
As we move into H2, the sector is well-positioned for a more mature, innovation-led cycle of investment, Shinde mentioned. Capital market activity picked up in the April-June period (Q2), with two IPOs raising $243 million and two QIPs totaling $245 million.
This marked a significant turnaround from Q1’s inactivity, reflecting a gradual return of investor confidence, especially in income-generating and platform-led real estate models. These developments point to a cautious but steady re-engagement with listed instruments, setting the stage for deeper capital market integration in H2, said the report.
Frequently Asked Questions
What percentage of total investment in India was driven by commercial development in Q2 2023?
Commercial development accounted for 62 per cent of total investment in India during the April-June period of 2023.
How many transactions were recorded in the real estate sector in Q2 2023, and what was their total value?
The quarter saw 17 transactions worth $1.3 billion, including IPOs and QIPs. Excluding public market activity, 13 deals were valued at $775 million.
What is the significance of the Small and Medium Real Estate Investment Trusts (SM REITs) segment gaining momentum?
The growing momentum in the SM REITs segment, with fresh registrations, indicates broader public market access for mid-sized developers, signaling a cautious but steady re-engagement with listed instruments.
What does the report by Grant Thornton Bharat predict for the second half of 2023?
The report predicts that the sector will enter the second half of the year with cautious optimism and an institutional focus, driven by the anticipated largest REIT issue in India and the return of IPO and SME REIT activity.
How has capital market activity changed from Q1 to Q2 2023 in the real estate sector?
Capital market activity picked up in Q2 2023, with two IPOs raising $243 million and two QIPs totaling $245 million, marking a significant turnaround from Q1’s inactivity and reflecting a gradual return of investor confidence.
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