India's real estate market is poised for a significant capital infusion, transitioning into what experts call a strong investment-driven phase. According to a new report by global real estate consulting giant CBRE, the sector is expected to attract investments in the range of USD 12 to 14 billion during the financial year 2025-26 (FY26). This bullish forecast underscores the growing confidence of both domestic and international investors in the country's property landscape.
Drivers of the Investment Surge
The anticipated investment boom is not concentrated in a single segment but is spread across various property types. The office sector is predicted to be a major magnet, accounting for a substantial share of the incoming capital. This is fueled by sustained demand for quality office spaces from technology companies, global capability centers (GCCs), and the burgeoning flexible workspace segment.
Following closely is the industrial and logistics segment, which has gained tremendous momentum from the expansion of e-commerce and the need for sophisticated supply chain networks. The residential real estate market, showing remarkable resilience and consistent sales, is also expected to draw significant investor interest. The report highlights that a mix of institutional investments, sovereign wealth funds, and pension funds are actively evaluating opportunities in these high-growth areas.
Beyond FY26: A Sustained Growth Trajectory
The optimism extends beyond the next fiscal year. CBRE's analysis suggests that the investment inflow is likely to be sustained and potentially grow further in the medium term. The consulting firm projects that total investments could reach between USD 18 and 20 billion by the financial year 2027-28 (FY28). This represents a compound annual growth rate (CAGR) of approximately 15-18% from the expected FY26 figures, signaling a robust and long-term growth cycle for the Indian property market.
This growth is underpinned by strong economic fundamentals, progressive government policies, and a notable improvement in transparency and regulatory frameworks within the real estate sector. The implementation of reforms like the Real Estate (Regulation and Development) Act (RERA) and the establishment of Real Estate Investment Trusts (REITs) have made the market more structured and attractive for institutional capital.
Geographical and Sectoral Hotspots
Metropolitan cities and their expanding peripheries will continue to be the primary focus for investments. Cities like Mumbai, Delhi-NCR, Bengaluru, Hyderabad, and Pune are expected to lead the charge, given their established commercial ecosystems and infrastructure development. The report also notes rising interest in emerging corridors and tier-II cities that are witnessing industrial and IT park development.
While office, industrial, and residential lead, alternative segments like data centers, life sciences real estate, and aged care facilities are emerging as new frontiers for investors seeking diversified portfolios. The evolution of India's consumption story and digital infrastructure is creating unique opportunities in these niche sectors.
In conclusion, the CBRE report paints a decidedly positive picture for Indian real estate. The sector's shift to an investment-driven phase, marked by sophisticated capital and a focus on income-generating assets, indicates its maturation and integration with global financial markets. The forecast of USD 12-14 billion in FY26 and up to USD 20 billion by FY28 sets a clear trajectory for sustained growth, positioning real estate as a key pillar of India's economic development in the coming years.
