Indian Real Estate Sees $1.80 Billion in Institutional Investments in Q2 2025
Despite a 42% yearly decline, institutional investments in Indian real estate surged 122% quarter-on-quarter in Q2 2025, reflecting cautious optimism amid market uncertainties.
Indian Real EstateInstitutional InvestmentsForeign InvestmentsCoinvestmentsMarket UncertaintyReal Estate NewsJul 07, 2025
While foreign investments continued to dominate, their share decreased from 71% in Q2 2024 to 66% in Q2 2025. In terms of value, foreign investments dropped by 46% to $1.19 billion from $2.21 billion. This shift underscores the cautious approach of foreign investors amid geopolitical conflicts and macroeconomic instability.
Shrinivas Rao, CEO of the company, commented, 'This growth momentum is expected to continue as several rating agencies predict economic growth of more than 6% during FY 2026. Moreover, the recent reduction in the repo rate is expected to bolster positive sentiment by reducing borrowing costs and improving credit access for the sector.'
The share of co-investments almost doubled to 15% from 8%, registering a marginal hike of 2% in terms of value. This trend indicates a cautious approach by foreign investors, driven by a desire to mitigate risks amidst uncertain demand due to geopolitical conflicts and macroeconomic instability.
Investors from the USA, Japan, and Hong Kong contributed around 89% to the foreign investments recorded in Q2 2025. The majority of these investments, approximately 69%, were concentrated in commercial assets. Residential properties received only 11% of the total investments, while the rest were directed towards diversified properties.
Domestic investors accounted for 19% of the total investments in Q2 2025, down from 21% in the same period last year. In value terms, domestic investments stood at $336 million, marking a 47% annual decline and a 28% drop compared to the previous quarter. The decline reflects cautious sentiment among domestic players amid market uncertainty due to geopolitical conflicts and trade tariffs.
Frequently Asked Questions
What was the total institutional investment in Indian real estate in Q2 2025?
The total institutional investment in Indian real estate in Q2 2025 was $1.80 billion.
How did the investment trend compare year-over-year and quarter-over-quarter?
Institutional investments in Indian real estate saw a 42% yearly decline but a 122% quarter-on-quarter increase in Q2 2025.
What percentage of the investments came from foreign investors in Q2 2025?
Foreign investors accounted for 66% of the total investments in Q2 2025, down from 71% in Q2 2024.
Which countries were the primary sources of foreign investments in the Indian real estate sector?
The USA, Japan, and Hong Kong contributed around 89% of the foreign investments in Q2 2025.
What was the impact of the recent reduction in the repo rate on the real estate sector?
The recent reduction in the repo rate is expected to bolster positive sentiment by reducing borrowing costs and improving credit access for the sector.
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