India’s real estate sector is on the brink of a record-breaking year, with equity investments poised to surpass USD 10 billion in 2024 for the first time. This surge is driven by robust activity in office assets, a growing pipeline of residential land acquisitions, and rising investor confidence. Between January and September 2024, equity capital inflows reached USD 8.9 billion, marking an impressive 46% year-on-year growth. Institutional and collective vehicle investors accounted for 40% of this capital, while domestic investors, primarily developers, contributed approximately USD 6 billion, representing 65% of the total inflows. Foreign investors brought in USD 3.1 billion, with North American and Singaporean investors leading the charge.
Deal volumes and sizes have seen notable increases, with around 200 transactions reported in 2024, compared to 151 during the same period in 2023. The average deal size climbed to USD 45 million, up from USD 36 million last year. The office sector has been a standout performer, experiencing a near 50% growth, while residential and mixed-use projects continued to attract substantial capital. Nearly 64% of investments in land and development sites were directed toward residential projects. Major urban centres, including Delhi-NCR, Mumbai, and Bengaluru, accounted for over 63% of total inflows, with Delhi-NCR alone contributing USD 2.3 billion. Debt financing also reached an all-time high of USD 4.7 billion, doubling the previous year’s figures.
Sustainability has emerged as a critical focus, with the Ministry of Housing and Urban Affairs urging developers to prioritise energy-efficient and community-driven developments. The shift towards creating sustainable spaces aligns with India’s broader environmental goals. Innovative frameworks such as SEBI’s SM REIT are also drawing attention to tier-II markets, promising more capital inflows and institutional participation.
India’s real estate sector continues to play a pivotal role in driving economic growth and urban development. It not only contributes significantly to GDP but also fosters community development through modern and sustainable infrastructure. This landmark growth in investments reflects the sector’s resilience and adaptability, positioning it as a cornerstone of India’s economic progress.