Foreign Investors Bet Big on India's Real Estate: Land, Retail, and Hospitality See Surge

Private equity investments in India's real estate sector reached $2.4 billion in the first half of 2025, with a significant shift towards retail, land, and hospitality segments.

Private EquityReal EstateIndiaRetailLandReal EstateJul 10, 2025

Foreign Investors Bet Big on India's Real Estate: Land, Retail, and Hospitality See Surge
Real Estate:Private equity investment inflows into the Indian real estate sector reached $2.4 billion (Rs 203 billion) in the first half of 2025, marking a 38% year-on-year increase, according to the latest report by Savills India, a global real estate consulting firm. In Q2 2025 alone, inflows stood at $1.6 billion (Rs 139 billion), doubling from the previous quarter.

It is important to note that the figures presented pertain solely to transactions executed via the private equity route. Investment volumes through other funding modes have exhibited significant variability over time, contributing to broader fluctuations in the market.

“PE inflows in H1 2025 underscore the growing confidence investors have in India's dynamic real estate market. While investments in traditional sectors like commercial offices remain integral, there is a clear strategic shift towards portfolio diversification. Segments such as retail, hospitality, and even emerging asset classes like student housing are gaining investors’ attention. This broadening focus reflects the maturity and resilience of the Indian market despite global headwinds. We expect this trend to strengthen further in the coming quarters, as investors continue to seek long-term value in India’s opportunity-rich real estate sector,” said Sumeet Bhatia, Managing Director, Capital Market Services, Savills India.

Some other key points in the report include:

- Commercial office assets continued to lead the pack in Q2 2025, accounting for around 31% of total investment volume.
- Investors also demonstrated a strategic shift in Q2 by recalibrating their portfolio to bet on high-growth potential in alternative real estate segments. Hospitality and student housing emerged as promising avenues, securing 15% and 1% of quarterly investment share, respectively.
- Land transactions accounted for a significant share of 40% in overall private equity investments in H1 2025, compared to 13% in the full year of 2024 and 26% in 2023.
- Mumbai remains high on the radar of investors, garnering about 70% of land investments in H1 2025.
- Foreign investors continued to dominate PE inflows during H1 2025, contributing a substantial 76% of the total investment volume.

Blackstone’s $378 million investment in South City Mall, Kolkata, marked the largest retail-focused deal of the quarter. Sumitomo and Brookfield invested $295 million and $151 million, respectively, in MMRDA assets, reinforcing global investor confidence in Mumbai’s infrastructure-led growth. Together, these top three deals signal a balanced mix of interest across retail, land, and urban development segments.

Frequently Asked Questions

What is the total private equity investment in India's real estate sector in H1 2025?

The total private equity investment in India's real estate sector in H1 2025 reached $2.4 billion (Rs 203 billion).

Which segments saw the most significant investment in Q2 2025?

Commercial office assets continued to lead, accounting for around 31% of total investment volume. Land transactions also saw a significant share of 40% in overall private equity investments.

What is the role of foreign investors in H1 2025 real estate investments?

Foreign investors dominated PE inflows during H1 2025, contributing a substantial 76% of the total investment volume.

What is Blackstone’s largest retail-focused deal in Q2 2025?

Blackstone’s largest retail-focused deal in Q2 2025 was a $378 million investment in South City Mall, Kolkata.

What does the shift towards alternative real estate segments like hospitality and student housing indicate?

The shift towards alternative real estate segments like hospitality and student housing indicates a strategic diversification and a focus on high-growth potential areas, reflecting the maturity and resilience of the Indian real estate market.

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