Year-ender 2025: Private Equity Investments in Indian Real Estate Surge 59% to $6.7 Billion
Private equity (PE) investments in Indian real estate have surged to $6.7 billion in 2025, marking a 59% year-over-year increase. This significant growth is largely driven by overseas institutional capital, which accounted for 76% of total inflows. The office segment led investments with $2.4 billion, supported by steady leasing and long-term demand, while data centres and residential assets followed, according to a report by Savills India. The report forecasts that investment momentum will continue in 2026, with inflows projected to be between $6.5 billion and $7.5 billion, led by office assets in core markets.
The recovery in private equity investments into Indian real estate reflects a gradual strengthening of market fundamentals following the post-pandemic adjustment period. Over the past few years, regulatory transparency under RERA, balance sheet consolidation among developers, and a clearer focus on asset-level performance have enhanced investor confidence.
Private equity institutional investments include equity deals executed through a private route, excluding plain debt deals executed via fund raises, QIPs, public market deals, and platform formations.
Office Segment Leads Sectoral Split
Sector-wise, the report noted that office assets accounted for the largest share of private equity investments in 2025, cornering 35.3% of total inflows. Data centres emerged as the second-largest investment destination with a 23.2% share, followed closely by residential assets at 21%. Industrial and logistics assets accounted for 9% of investments, while retail and hospitality attracted 6% and 5%, respectively. Co-living and student housing remained nascent, together accounting for just 0.5% of total inflows.
Savills observed that office investments were supported by stable leasing and long-term demand visibility, while data centre investments were entirely foreign-led, reflecting global interest in India’s digital infrastructure story. The residential segment saw balanced participation from both domestic and overseas investors, driven largely by sustained end-user demand in premium and luxury housing.
Land and Alternative Assets Draw Selective Interest
Land continued to remain a key asset class, accounting for nearly one-fourth of total equity inflows during the year. More than 60% of land-related investments were aligned towards office and data centre developments, indicating investor preference for future-ready, income-generating platforms, the report said.
Other segments, such as industrial and logistics, retail, hospitality, co-living, and student housing, also saw selective investor participation. Institutions are increasingly diversifying portfolios while remaining cautious on execution and exit visibility, according to Savills.
Outlook for 2026 Remains Positive
Looking ahead, Savills India expects private equity inflows into real estate to remain steady in 2026, in the range of $6.5–7.5 billion. Office assets in core markets are likely to continue attracting institutional capital, while industrial and logistics parks are expected to benefit from supply chain diversification, manufacturing-led demand, and the growing shift towards organized warehousing.
Data centres are expected to witness sustained investor interest, supported by rising digital adoption, cloud expansion, and long-term capacity requirements. Residential real estate is also expected to see steady private equity participation, led by luxury and premium housing. Alternative asset classes such as student housing, co-living, senior living, and life sciences are expected to gradually gain traction, though from a relatively small base.
“The growing adoption of REITs in India is reshaping the real estate investment landscape by improving exit visibility and reinforcing institutional participation across asset classes,” said Sumeet Bhatia, Managing Director, Capital Market Services, Savills India.
