Equity inflows in Indian real estate hit historic high of $11.4 bn in 2024

Singapore, US, and Canada dominated foreign equity investments in the Indian real estate market in CY 2024. These three countries cumulatively contributed >25% of the total equity investments in the country’s real estate in 2024, according to CBRE’s ‘Market Monitor Q4 2024 – Investments’ report.

Singapore accounted for a ~36% share of the total foreign equity investments in CY 2024, followed by the United States with a ~29% share and Canada with ~22%. Investments from the UAE also witnessed a significant uptick in CY 2024 compared to the last year. Total equity investment in Indian real estate recorded an all-time high of US $11.4 bn in 2024, up ~54% Y-o-Y.

Domestic investments remained the primary driver, with a ~70% share in total equity investments in CY 2024. According to the report, this remarkable surge in investment inflows reflects the unprecedented growth of India’s real estate market in 2024, driven by a resurgence in capital deployment across built-up assets and sustained momentum in the acquisition of land/development sites. Developers led the way in capital inflows, capturing ~44% of the total equity investments in 2024, followed by institutional players at ~36%, corporations at ~11%, REITs at ~4%, and other categories comprising ~5%.

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In terms of asset classes, equity investments in 2024 were majorly driven by land/development sites, which accounted for ~39% of the total share. This was followed by the office sector at ~32%, retail at ~9%, residential at ~8%, industrial and logistics (I&L) at ~6%, hotels at ~2%, and other segments making up more than 4%. Mumbai and Delhi-NCR were the top destinations for investment inflows in 2024, each accounting for ~25% of the total. They were followed by Bengaluru at ~14%, Chennai at ~8%, and Hyderabad at ~6%.

During Oct-Dec’24 quarter, total equity investment in real estate stood at US$2.5 bn, marking an impressive ~91% Y-o-Y growth. This growth underscores the sustained investor confidence in India’s real estate market, driven by favourable economic conditions and strategic capital deployment across key sectors.

Anshuman Magazine, Chairman & CEO – India, South-East Asia, Middle East & Africa, CBRE, said, “We expect to see sustained momentum in investment activity, particularly in built-up office assets and residential development sites. The increasing focus on e-commerce and quick commerce is set to drive robust growth in the logistics and warehousing sector, creating new opportunities for both developers and investors.”

Gaurav Kumar, Managing Director, Capital Markets and Land, CBRE India, said, “We will continue to witness significant growth momentum in investment activity from both institutional investors and domestic developers. This is being driven by a surge in real estate development activity, backed by healthy demand for office, residential, mixed-use, and industrial & logistics spaces. Further, segments such as retail and hospitality are expected to experience renewed interest as the market continues to diversify and adapt to evolving consumer and business needs.”

Investment Outlook

* Investment activity is expected to maintain its positive trajectory in 2025.

* Key drivers include renewed investments in built-up office assets and strong acquisition pipeline for residential development sites.

* Heightened investments in the quick commerce / e-commerce space in 2024 are also likely to spur the development of quality warehousing infrastructure.

* India’s metros and tier-I cities are expected to continue being the primary recipients of equity inflows.

* In addition, tier-II locations are becoming attractive due to a spurt in real estate development, backed by healthy demand, particularly in the residential, mixed-use, I&L, retail, and hotel sectors.