Institutional investments in India's real estate sector reached USD 1.6 billion during the first quarter of 2026, marking a 26% year-on-year increase, according to a report by Cushman & Wakefield. However, this figure represents a sharp 52% decline from the previous quarter, largely attributed to the ongoing Middle East conflict.
For comparison, investments totaled USD 1.27 billion in January-March 2025 and USD 3.35 billion in the October-December quarter of 2025. The data, reported by PTI, highlights a significant shift in capital flows.
Domestic investors contributed USD 1.21 billion in Q1 2026, up from USD 0.75 billion a year earlier and down from USD 2.71 billion in the preceding quarter. Foreign investments stood at USD 0.39 billion, lower than USD 0.52 billion in the same period last year and USD 0.61 billion in October-December 2025.
The consultancy firm noted that domestic investors have accounted for a larger share of institutional investments in four of the last five quarters, indicating a sustained rebalancing of capital flows. "At a time when foreign capital remains sensitive to global macroeconomic and geopolitical developments, the increasing depth and consistency of domestic capital is helping provide stability and continuity to investment activity," Cushman & Wakefield stated.
Somy Thomas, Executive Managing Director - Capital Markets at Cushman & Wakefield, emphasized that domestic capital has been particularly active in the office segment, and this momentum could strengthen further. "At the same time, the consistent performance of REITs has reinforced investor confidence in income-generating real estate, while relatively muted returns in equity markets have prompted a rebalancing of capital towards more stable, yield-driven assets," Thomas said.
City-wise, Delhi-NCR attracted 28% of total quarterly investments in Q1 2026, followed by Chennai with 17% and Bengaluru with 14%. Commenting on the trend, Sanjeevini Group founder and Chairman Umesh Gowda H A noted that Bengaluru's share reflects the city's strong fundamentals and appeal for long-term investors. "The continued inflow of domestic capital is helping sustain project pipelines, support new developments, and maintain pricing discipline even amid global uncertainties," Gowda added.
