India’s Real Estate Market Draws $1.3 Billion in Q1 2025, Led by Residential and Industrial Surge: Colliers

According to real estate consultancy Colliers India, institutional investments in Indian real estate rose by 31% year-on-year during the January - March quarter of 2025, reaching a total of USD 1.3 billion. The sharp growth was largely attributed to increased domestic capital inflows and a remarkable uptick in the residential and industrial & warehousing segments.

Colliers noted that domestic investors were responsible for 60% of the total inflows during the quarter, with their contributions growing by 75% annually to USD 0.8 billion. A large portion of this was directed towards the office, industrial, and warehousing asset classes.

One of the standout developments was in the residential sector, where investment inflows nearly tripled - rising from USD 102.6 million in Q1 2024 to USD 302.9 million in Q1 2025. Industrial and warehousing assets also saw a robust 73% increase in investments, jumping from USD 177.7 million to USD 307.7 million.

However, the office segment saw a dip, with institutional investments falling 23% year-on-year to USD 434.2 million. Mixed-use projects fared better, receiving USD 191.1 million in Q1 2025 - a 46% increase over the same period last year.

Badal Yagnik, CEO of Colliers India, reportedly emphasized that the resilience of Indian real estate continues to attract institutional interest. He pointed out that core asset classes - office, residential, and industrial & warehousing - together constituted nearly 80% of total inflows, reflecting investor confidence and the market's untapped potential.

Looking ahead, Yagnik indicated that momentum is likely to continue throughout 2025, driven by India's strong economic growth, high demand across sectors, and a generally optimistic business environment.

Experts from the alternative investment space echoed similar sentiments. Binitha Dalal, Founder & Managing Partner of Mt K Kapital, highlighted that structured vehicles like AIFs are gaining traction, offering investors both risk diversification and regulatory transparency. She added that the current investment patterns reaffirm confidence in the sector's potential for returns.

Ankur Jalan, CEO of Golden Growth Fund, noted that even in the face of global uncertainties, India's real estate continues to attract strong institutional interest. He cited declining inflation, expectations of interest rate cuts, and a positive economic outlook as key reasons why the Indian property market is increasingly viewed as a lucrative destination for both foreign and domestic investors.

The Colliers report further clarified that institutional investments accounted for a diverse pool, including foreign banks, family offices, REITs, sovereign wealth funds, NBFCs, and private equity players, with data compiled from publicly available sources.