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Indian Real Estate Sees 23% PE Surge
6 Oct
Summary
- Private equity investment surged 23% to $2.7 billion in H1 FY27.
- Domestic capital accounted for nearly half of total inflows.
- Office and data centers were top asset classes for investment.
Private equity investment in Indian real estate experienced a significant 23% year-on-year increase, totaling $2.7 billion during the first half of FY27 (April-September). This marks the highest inflow for a first half since FY23 and represents a substantial portion of the previous fiscal year's total.
Domestic investors played a crucial role, injecting approximately $1.3 billion across 24 deals, a nearly sixfold increase from the prior year. Their contribution to total PE investment rose to 48%, highlighting a key structural shift in the market.
Foreign investors contributed around $1.4 billion through six deals, with a notably higher average deal size compared to domestic investors. The overall deal activity also saw an uptick, with an 18% rise in the average deal size.
Equity deals dominated PE inflows, constituting 83% of the total, a trend not seen since FY23. Office spaces remained the preferred asset class, attracting 35% of the investments. Data centers experienced a dramatic rise, capturing 29% of inflows, up from 4% in FY26, with hospitality and residential also seeing significant interest.
This sustained growth in institutional capital flows and the increasing participation of domestic investors signal strong conviction in the sector's long-term prospects. If investment trends continue, total PE investment for FY27 could reach approximately $4.8 billion, the highest in at least five years.
