Institutional investments in India's real estate sector reached $1.9 billion in the second quarter of 2026 (April–June), rising 16 per cent quarter-on-quarter, according to a report released on Tuesday, 21 July by global property consultancy Cushman & Wakefield. The figure marks a 7 per cent moderation year-on-year, yet signals continued resilience driven by domestic capital and a strong appetite for income-generating assets.

H1 2026 Investment Overview

For the first half of 2026, institutional investments totalled $3.5 billion, up 6 per cent from H1 2025, reflecting sustained confidence in India's long-term real estate fundamentals even as global macroeconomic headwinds persisted. The overall market continued to see consistent capital deployment, with domestic investors playing an increasingly dominant role.

Office Assets Lead for Fourth Straight Quarter

Office assets dominated Q2 2026 flows, attracting nearly $1 billion and accounting for 51 per cent of total investments — marking the fourth consecutive quarter in which the segment led the market. Investor preference for office real estate is underpinned by robust occupier demand, particularly from Global Capability Centres (GCCs), tightening vacancy levels across major office markets, and continued rental growth in premium micro-markets.

Data Centres Emerge as Second-Largest Recipient

Data centres captured 40 per cent of Q2 investment volumes, emerging as the second-largest asset class by capital inflow. The sector's growing share reflects rising investor interest in digital infrastructure, driven by rapid AI adoption, cloud expansion, and data localisation requirements — a structural demand shift that analysts expect to persist through the medium term.

Domestic Investors Surge, Foreign Share Contracts

A notable shift in capital composition defined H1 2026: domestic institutions deployed $2.2 billion, accounting for 64 per cent of total investment activity, up sharply from a 43 per cent share in the corresponding period of the previous year. Foreign investments, by contrast, totalled $1.3 billion, representing 36 per cent of the total — down from 57 per cent a year earlier.

Private equity investors remained the primary source of institutional capital in Q2, contributing 85 per cent of total investment volumes. REIT-led investments accounted for the remaining 15 per cent.

Somy Thomas, Executive Managing Director, Capital Markets, Cushman & Wakefield, noted that investors are increasingly pursuing portfolio and multi-city opportunities to achieve greater scale and diversification.

Outlook for H2 2026

Cushman & Wakefield projected that institutional investment activity will remain stable in H2 2026, supported by India's strong macroeconomic fundamentals and continued infrastructure-led growth. With office demand firm and data centre capital commitments accelerating, the second half is expected to sustain the momentum established in H1.