India Real Estate PE Jumps 66% to $1.2B as Domestic Investors Lead

The report from Savills India said office assets accounted for 41 per cent of total investment volume in Q1 2026 with the capital concentrated in Gurugram and Pune, while the hospitality sector captured 17 per cent of the real estate sector.

Domestic investors dominated equity inflows, contributing $817 million, or 66 per cent of the quarter's total.

Around 63 per cent of domestic investments were directed towards the office sector, while the residential sector and alternative asset classes (such as student housing and co-living) accounted for 18 per cent and 13 per cent of total domestic investments, respectively.

Significant inflows into the hospitality sector during the quarter and other emerging asset classes reflect a continued shift towards portfolio diversification, the report said.

"Q1 2026 marks a strong start for India's real estate sector in terms of equity investments. In a departure from trends observed in recent quarters, domestic investors took the lead in investment activity, as foreign inflows remained cautious amid global uncertainties," Sumeet Bhatia, Managing Director, Capital Market Services, Savills India, said.

Sumeet said the firm remains optimistic about the year ahead, but the evolving trajectory of capital inflows will be critical to watch amid a persistently challenging environment.

Activity in India's private equity market improved in the Q1 2026, with total equity investments reaching $3.83 billion, surging 0.9 per cent sequentially and 66.4 per cent year‑on‑year, a recent report said.

Asia Pacific has become the world's most dynamic office market, with India leading the growth and broader region driven by younger, ESG‑aligned assets and demand that outpaces the US and Europe, another report had said.

- IANS