Institutional investments in India 's office real estate demonstrated strong recovery in 2025, indicating restored confidence despite complex global economic conditions. Office asset investments increased by 27% year-on-year in Q3, reaching $0.8 billion and representing over 60% of quarterly inflows, as reported by Colliers India.
This recovery contributed significantly to total institutional real estate investments in India, reaching $4.3 billion in the first nine months of 2025, despite showing a 9% decrease from the previous year.
The increased interest in office assets stems from high demand for Grade A commercial properties, especially in Tier I cities like Chennai and Pune. The professional management of the office segment continues to attract investors across established markets whilst expanding into new territories.
Office investments constituted 35% of total investment inflows year-to-date, comparable to 2024 levels, with domestic investors leading the charge. Domestic capital increased by 52% year-on-year to USD 2.2 billion, whilst foreign investments decreased by 36% to $2.1 billion. This represents a notable change from 2021, when foreign capital represented 84% of real estate investments in India.
Badal Yagnik, CEO of Colliers India, said, "Institutional investments in Indian real estate reached $1.3 billion in Q3 2025, an 11% increase year-on-year. Domestic capital contributed 60% of quarterly inflows, with strong backing from both the office and residential sectors. This trend reflects the growing depth and confidence of domestic funds and REITs in the market."
The residential sector showed positive growth, with investments increasing 11% year-on-year to $1.1 billion, backed by domestic and foreign institutional support. Alternative assets including mixed-use developments, retail, and industrial segments showed significant progress, jointly representing nearly one-third of total inflows.
Sharad Mittal, Founder and CEO of Arnya RealEstates Fund Advisors , said the residential real estate market continues to demonstrate strong end-user demand, improved affordability, and sustained investor confidence. "We see compelling opportunities in greenfield projects across cities; Mumbai redevelopment market is attractive. Over the next 12–18 months, we intend to deploy over Rs 2,000 crore across the capital stack spanning structured debt and equity towards high-quality residential projects. Our focus remains on partnering with reputed developers and backing mid-segment residential projects across cities," he said.
Mumbai and Bengaluru remained primary investment destinations, attracting $0.8 billion (19%) and $0.5 billion (12%) respectively in the first nine months. Pune experienced remarkable growth in office investments, increasing over 25-fold in Q3 compared to the previous year. "Emerging cities like Hyderabad, Kolkata, Chennai, and Delhi NCR continued to attract steady institutional interest, spreading real estate investment more evenly across multiple locations," said Ambar Maheshwari, CEO of Sammaan Asset Management, a 100% subsidiary of Sammaan Capital (earlier known as Indiabulls Housing ).
The increased prominence of domestic institutional investors was highlighted by new domestic real estate fund launches in 2025, expanding investment options and market liquidity. These funds actively pursued office spaces and residential projects, indicating positive sector outlook. Transactions led by prominent domestic entities and REITs emphasised local capital's growing influence in India's property sector.
The office sector's improvement is supported by strong leasing activity and occupier demand, particularly from technology, BFSI, and global capability centres maintaining office-first policies. Industry data shows office leasing absorption reached peak levels in Q2 2025 and maintained positive momentum, strengthening investor confidence in commercial property fundamentals.
For future prospects, domestic institutional investors and REITs are anticipated to provide consistent capital, whilst foreign investors may remain prudent amidst global economic uncertainty. Analysts suggest the balanced combination of domestic and foreign capital, alongside geographically diverse investments, supports sustained growth in Indian real estate.
This recovery contributed significantly to total institutional real estate investments in India, reaching $4.3 billion in the first nine months of 2025, despite showing a 9% decrease from the previous year.
The increased interest in office assets stems from high demand for Grade A commercial properties, especially in Tier I cities like Chennai and Pune. The professional management of the office segment continues to attract investors across established markets whilst expanding into new territories.
Office investments constituted 35% of total investment inflows year-to-date, comparable to 2024 levels, with domestic investors leading the charge. Domestic capital increased by 52% year-on-year to USD 2.2 billion, whilst foreign investments decreased by 36% to $2.1 billion. This represents a notable change from 2021, when foreign capital represented 84% of real estate investments in India.
Badal Yagnik, CEO of Colliers India, said, "Institutional investments in Indian real estate reached $1.3 billion in Q3 2025, an 11% increase year-on-year. Domestic capital contributed 60% of quarterly inflows, with strong backing from both the office and residential sectors. This trend reflects the growing depth and confidence of domestic funds and REITs in the market."
The residential sector showed positive growth, with investments increasing 11% year-on-year to $1.1 billion, backed by domestic and foreign institutional support. Alternative assets including mixed-use developments, retail, and industrial segments showed significant progress, jointly representing nearly one-third of total inflows.
Sharad Mittal, Founder and CEO of Arnya RealEstates Fund Advisors , said the residential real estate market continues to demonstrate strong end-user demand, improved affordability, and sustained investor confidence. "We see compelling opportunities in greenfield projects across cities; Mumbai redevelopment market is attractive. Over the next 12–18 months, we intend to deploy over Rs 2,000 crore across the capital stack spanning structured debt and equity towards high-quality residential projects. Our focus remains on partnering with reputed developers and backing mid-segment residential projects across cities," he said.
Mumbai and Bengaluru remained primary investment destinations, attracting $0.8 billion (19%) and $0.5 billion (12%) respectively in the first nine months. Pune experienced remarkable growth in office investments, increasing over 25-fold in Q3 compared to the previous year. "Emerging cities like Hyderabad, Kolkata, Chennai, and Delhi NCR continued to attract steady institutional interest, spreading real estate investment more evenly across multiple locations," said Ambar Maheshwari, CEO of Sammaan Asset Management, a 100% subsidiary of Sammaan Capital (earlier known as Indiabulls Housing ).
The increased prominence of domestic institutional investors was highlighted by new domestic real estate fund launches in 2025, expanding investment options and market liquidity. These funds actively pursued office spaces and residential projects, indicating positive sector outlook. Transactions led by prominent domestic entities and REITs emphasised local capital's growing influence in India's property sector.
The office sector's improvement is supported by strong leasing activity and occupier demand, particularly from technology, BFSI, and global capability centres maintaining office-first policies. Industry data shows office leasing absorption reached peak levels in Q2 2025 and maintained positive momentum, strengthening investor confidence in commercial property fundamentals.
For future prospects, domestic institutional investors and REITs are anticipated to provide consistent capital, whilst foreign investors may remain prudent amidst global economic uncertainty. Analysts suggest the balanced combination of domestic and foreign capital, alongside geographically diverse investments, supports sustained growth in Indian real estate.
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