NEW DELHI— The Indian real estate sector attracted $1.80 billion in institutional investments during the April–June quarter (Q2 2025), with investors from the United States, Japan, and Hong Kong accounting for nearly 89 percent of all foreign capital inflows, according to a report released Monday by Vestian.
Investment volumes more than doubled from the previous quarter, marking a sharp 122 percent increase. Foreign capital dominated investment activity in Q2, with a significant portion—approximately 69 percent—directed toward commercial real estate. Residential assets accounted for just 11 percent of total investments, while the remainder flowed into diversified property portfolios.
The report also noted a shift in investor behavior, with co-investments rising to 15 percent, up from 8 percent in the previous quarter. This move away from direct investments reflects a more cautious strategy by foreign investors, who are aiming to reduce risk amid ongoing geopolitical tensions and global economic uncertainties.
“Institutional investments saw a strong recovery in Q2 2025, primarily fueled by a sharp resurgence in commercial real estate activity compared to the previous quarter,” said Shrinivas Rao, FRICS, CEO of Vestian. “While overall inflows are still lower year-over-year, the robust quarterly growth signals renewed investor confidence, backed by sound macroeconomic fundamentals and resilient demand.”
Rao added that this positive momentum is likely to continue, as several rating agencies project India’s economic growth to exceed 6 percent in FY 2026.
In addition, the recent reduction in the repo rate is expected to further boost market sentiment by lowering borrowing costs and improving credit access across the sector.
Domestic investors contributed 19 percent of total institutional inflows in Q2 2025, down from 21 percent during the same period last year. In value terms, domestic investments amounted to $336 million for the quarter. (Source: IANS)
