Is India the New Leader in APAC Real Estate Private Credit?
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Synopsis
India has claimed the second spot in the Asia-Pacific real estate private credit market, capturing 36% of fundraising from 2020-2024. As traditional lending tightens, developers are increasingly turning to private credit, paving the way for significant growth in the sector.
Key Takeaways
- India ranks second in APAC real estate private credit.
- Accounts for 36% of regional fundraising from 2020-2024.
- Assets under management rose from $0.7 billion to $17.8 billion.
- Projected 20-25% contribution to private credit growth by 2028.
- Shift towards private credit due to tightening bank lending.
Mumbai, Nov 24 (NationPress) India has emerged as a significant player in the rapidly evolving real estate private credit landscape within the Asia-Pacific region, achieving the second position and representing 36 percent of the regional fundraising from 2020 to 2024, according to a recent report.
The findings by Knight Frank indicate that the assets under management in India's private credit sector have surged, escalating from $0.7 billion in 2010 to $17.8 billion in 2023.
Knight Frank projects that India will contribute between 20 and 25 percent of the anticipated $90–110 billion growth in private credit by 2028, fueled by an enhanced investor appetite, policy reforms, and a growing demand from developers for financing outside traditional banks.
This swift growth is bolstered by significant shifts in the financing ecosystem as outlined in the report.
Developers are increasingly looking to private credit and alternative lenders as conventional bank lending tightens and regulatory frameworks adapt.
Global private equity firms, family offices, and institutional investors have swiftly mobilized their capital, drawn by attractive returns and bolstered confidence in India's real estate market.
Shishir Baijal, Chairman and Managing Director of Knight Frank India, stated that India's solid economic standing and evolving regulations have allowed private credit to gain traction.
He also remarked that developers are now relying more on structured financing to fill funding gaps due to the growing demand for housing.
“India’s rise as a prominent private credit market in Asia-Pacific underscores the nation's robust economic fundamentals, regulatory improvements, and increasing participation from institutional investors,” Baijal emphasized.
He noted that the combination of governance enhancements and growth prospects makes India an attractive destination for global capital, particularly when interest rates are elevated in various markets.
The report further emphasizes that India's private credit sector is expanding beyond conventional development financing.
Structured debt, last-mile project financing, and special situation financing are now essential for completing stalled projects and enhancing liquidity across the sector.
This diversification, according to Knight Frank, is fortifying the market's stability and attracting a broader array of investors.
Point of View
It is crucial to recognize India's emerging role in the APAC real estate private credit market. This growth is not just a reflection of local dynamics but also indicates a shift in global investment strategies. As the market diversifies and evolves, it presents an opportunity for India to strengthen its economic position and attract international capital.
NationPress
24/11/2025
Frequently Asked Questions
What is private credit in real estate?
Private credit in real estate refers to non-bank lending sources that provide financing for real estate projects, often characterized by higher returns and more flexible terms compared to traditional bank loans.
How has India's private credit market grown?
India's private credit market has grown significantly, with assets under management increasing from $0.7 billion in 2010 to $17.8 billion in 2023, driven by a strong demand for alternative financing.
What factors are driving the growth of private credit in India?
The growth is driven by a combination of stronger investor appetite, regulatory reforms, and an increasing reliance on non-bank financing by developers.
What role does Knight Frank play in this sector?
Knight Frank provides critical insights and data regarding the private credit market, helping stakeholders understand trends and opportunities within the real estate financing landscape.
Why is India attractive to global investors?
India is appealing to global investors due to its robust economic fundamentals, evolving regulations, and the potential for high returns in the real estate sector, especially amidst rising housing demand.
