Institutional Investment in Indian Real Estate Jumps 50% to $4.5 Billion in First Half of 2026

New Delhi- India's real estate sector attracted institutional investments worth $4.5 billion during the first half of 2026, marking a 50 per cent year-on-year increase and the strongest first-half performance recorded in the last six years, according to a report released by Colliers India.

The report noted that investment momentum remained strong despite geopolitical uncertainties in West Asia. During the April-June quarter alone, institutional investments surged 70 per cent year-on-year to $2.9 billion.

Domestic investors emerged as the biggest contributors, investing $2.6 billion and accounting for 57 per cent of total inflows. Foreign investments also remained healthy, rising 24 per cent year-on-year to $1.9 billion.

Commenting on the trend, Badal Yagnik, Chief Executive Officer and Managing Director of Colliers India, said domestic investors have consistently contributed nearly 60 per cent of institutional investments in recent quarters, while foreign investors are becoming more selective and are increasingly exploring opportunities beyond traditional real estate assets.

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The office segment continued to dominate investment activity during the first six months of the year, with operational office properties attracting the highest capital, largely driven by domestic investors.

Mixed-use developments and alternative assets each drew investments of around $800 million, with both segments contributing nearly one-fifth of the total institutional inflows. Meanwhile, the hospitality sector witnessed a sharp rise in investor interest, attracting $300 million—more than three times the amount recorded during the corresponding period last year.

In contrast, institutional investments in the residential sector declined 43 per cent year-on-year to $500 million, reflecting investor caution amid rising construction costs and a moderation in housing sales.

Among key markets, Chennai and Bengaluru together attracted nearly $1.2 billion in investments, accounting for around 27 per cent of the total institutional inflows during the first half of 2026.

The report also highlighted that multi-city transactions made up 46 per cent of total investments, while Tier II and Tier III cities continued to attract growing institutional capital across hospitality, industrial and residential projects.

With inputs from IANS