Key Takeaways
- • Institutional real estate investment in India reached USD 1.9 billion in Q2 2026, up 16% quarter-on-quarter but down 7% year-on-year, according to Cushman & Wakefield's Q2 2026 Capital Marketbeat report.
- • Office assets attracted nearly USD 1 billion, or 51% of Q2 2026 institutional investment, marking the fourth consecutive quarter in which office led India's real estate investment landscape.
- • Data centres captured 40% of Q2 2026 institutional capital, the second-largest share, driven by AI adoption, cloud expansion and data localisation demand.
- • Domestic institutions accounted for 54% of Q2 2026 investment versus 46% from foreign investors, extending a four-quarter run in which domestic capital has exceeded foreign capital.
- • H1 2026 institutional investment totalled USD 3.5 billion, up 6% from H1 2025, with domestic investors providing 64% (USD 2.2 billion) and foreign investors 36% (USD 1.3 billion).
Summary
Institutional investment in India's real estate sector remained resilient in Q2 2026, reaching USD 1.9 billion, according to Cushman & Wakefield's Q2 2026 Capital Marketbeat report. The figure represented a 16% increase quarter-on-quarter, though activity moderated 7% year-on-year. For the first half of 2026, institutional investments totalled USD 3.5 billion, a 6% increase over H1 2025, which the firm characterised as continued confidence in India's long-term real estate fundamentals despite global macroeconomic uncertainty.
Office assets remained the dominant asset class, attracting nearly USD 1 billion and accounting for 51% of total Q2 investment. This was the fourth consecutive quarter in which office led the market. Investor demand has been supported by occupier demand from Global Capability Centres (GCCs), tightening vacancies across major office markets, rental growth in premium micro-markets, and limited availability of investment-grade assets. Data centres were the second-largest recipient, with a 40% share, reflecting investor interest in digital infrastructure linked to AI adoption, cloud expansion and data localisation requirements.
Domestic institutions held a 54% share of Q2 investment compared with 46% from foreign investors, and have outperformed foreign capital for four consecutive quarters. On a half-year basis, domestic investors deployed USD 2.2 billion (64%), up from a 43% share in H1 2025, while foreign investment totalled USD 1.3 billion (36%), down from 57% a year earlier. Cushman & Wakefield noted that domestic participation has helped offset volatility in foreign flows linked to currency movements and geopolitical developments.
By deal structure, private equity accounted for 85% of Q2 volumes and REIT-led investments for 15%. Multi-city portfolios made up 55% of total capital deployed, and Bengaluru led individual cities with a 23% share, followed by Chennai at 17%.
Looking ahead, Cushman & Wakefield expects institutional activity to remain stable in H2 2026, supported by India's macroeconomic fundamentals and infrastructure-led growth, with domestic capital remaining the primary driver and foreign participation likely to improve gradually as global conditions stabilise. Somy Thomas, Executive Managing Director - Capital Markets at Cushman & Wakefield, said capital allocation is becoming increasingly differentiated across asset classes, and that investors are pursuing portfolio and multi-city opportunities for scale and diversification. She added that the firm expects investment activity to remain resilient through the second half of 2026, with domestic investors continuing to anchor momentum.
Office assets remained the dominant asset class, attracting nearly USD 1 billion and accounting for 51% of total Q2 investment. This was the fourth consecutive quarter in which office led the market. Investor demand has been supported by occupier demand from Global Capability Centres (GCCs), tightening vacancies across major office markets, rental growth in premium micro-markets, and limited availability of investment-grade assets. Data centres were the second-largest recipient, with a 40% share, reflecting investor interest in digital infrastructure linked to AI adoption, cloud expansion and data localisation requirements.
Domestic institutions held a 54% share of Q2 investment compared with 46% from foreign investors, and have outperformed foreign capital for four consecutive quarters. On a half-year basis, domestic investors deployed USD 2.2 billion (64%), up from a 43% share in H1 2025, while foreign investment totalled USD 1.3 billion (36%), down from 57% a year earlier. Cushman & Wakefield noted that domestic participation has helped offset volatility in foreign flows linked to currency movements and geopolitical developments.
By deal structure, private equity accounted for 85% of Q2 volumes and REIT-led investments for 15%. Multi-city portfolios made up 55% of total capital deployed, and Bengaluru led individual cities with a 23% share, followed by Chennai at 17%.
Looking ahead, Cushman & Wakefield expects institutional activity to remain stable in H2 2026, supported by India's macroeconomic fundamentals and infrastructure-led growth, with domestic capital remaining the primary driver and foreign participation likely to improve gradually as global conditions stabilise. Somy Thomas, Executive Managing Director - Capital Markets at Cushman & Wakefield, said capital allocation is becoming increasingly differentiated across asset classes, and that investors are pursuing portfolio and multi-city opportunities for scale and diversification. She added that the firm expects investment activity to remain resilient through the second half of 2026, with domestic investors continuing to anchor momentum.
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