India’s Real Estate Investments Hit 6 Year High as Domestic Capital Reaches Record $2.6 Billion

India's real estate sector recorded its strongest first-half investment performance in six years, with institutional inflows rising 50% YoY to $4.5 billion during January to June 2026, according to Colliers India. 

Domestic institutional investors deployed a record $2.6 billion, contributing 57% of total investments after an 80% YoY increase, while foreign investments rose 24% YoY to $1.9 billion despite global trade and geopolitical uncertainties. 

Domestic Capital Leads Growth 

Institutional investments maintained their momentum in the second quarter, increasing 70% YoY to $2.9 billion, supported by participation from both domestic and overseas investors. 

Badal Yagnik, CEO and Managing Director, Colliers India, said domestic investors have consistently contributed 40% to 60% of real estate investments over recent quarters by expanding across multiple asset classes. He added that balanced participation from domestic and foreign investors will remain important for the sector's next phase of growth. 

Office Assets Attract Maximum Investments 

The office segment remained the largest investment destination, attracting $1.88 billion, accounting for more than 40% of total inflows. Investments in office assets surged 167% YoY, with domestic investors largely preferring income-generating operational office properties. 

Residential investments, however, declined 43% YoY to $470.4 million, as rising construction costs, moderating housing sales and project viability concerns weighed on investor sentiment. 

Mixed-Use and Hospitality Investments 

Mixed-use and alternative assets each attracted around $0.8 billion, contributing nearly one-fifth of H1 investments, while hospitality received around $0.3 billion, recording a more than three-fold annual increase, led mainly by foreign investors. 

According to Vimal Nadar, National Director and Head of Research, Colliers India, office assets contributed $1.1 billion, or 37% of Q2 inflows, while mixed-use and alternative assets recorded strong annual growth.  

He said investors continued to prefer operational office assets, supported by the recent listing of another office REIT and expectations of stronger office leasing in H2 2026. 

Regional Investment Trends 

Among Tier I cities, Chennai and Bengaluru attracted $1.2 billion, representing 27% of H1 inflows, with office assets accounting for 85% to 95% of investments in both cities.  

Multi-city transactions contributed 46% of total inflows, while Tier II and III cities, including Coorg, Hosur, Coimbatore, Kochi and Ujjain, saw notable investments across hospitality, industrial and warehousing, and residential assets. 

Read More: India Plans Integrated CBG Policy To Cut Natural Gas Imports! 

Conclusion 

Domestic institutional investors remained the largest source of capital for India's real estate sector during H1 2026, helping institutional investments reach $4.5 billion, the highest first-half level recorded in the past six years.   

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