The residential sector has emerged as the leading investment choice within India’s real estate market, securing 45% of total investments and surpassing the traditionally dominant office sector, as per a report by JLL. Institutional investments in this sector achieved a record high of $8.9 billion (approximately Rs 75,607 crore) in 2024, exceeding the previous peak of $8.4 billion (around Rs 71,326.5 crore) recorded in 2007.
This represents a 51% increase from $5.8 billion (approximately Rs 49,249.25 crore) in 2023, with deal activity rising by 47% year-on-year to reach 78 transactions. Foreign institutional investors played a significant role in this investment landscape, contributing 63% of the total, while domestic investors accounted for 37%. Qualified institutional placements (QIPs) were instrumental, raising $2.7 billion (approximately Rs 22,926.37 crore), with 57% of residential investments funneled through this mechanism. Among different asset classes, the residential segment attracted 45 per cent of inflows followed by office buildings 28 per cent and warehousing properties 23 per cent.
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Furthermore, 77% of transaction volumes were directed towards non-core assets, including data centres, student housing, life sciences, and healthcare, which suggests a heightened risk tolerance among investors.
“Strong growth, political stability, and diverse investment opportunities positioned India favourably in the global economic context. Along with platform commitments, 2024 will see investor interest cross the $11 billion mark (approx. Rs 93,403.75 crore),” said Lata Pillai, senior managing director and head of capital markets, India, JLL.
Additionally, Real Estate Investment Trusts (REITs) investments approached $800 million (approximately Rs 6,793 crore) in 2024, more than tripling from the levels seen in 2023. “The growing participation of domestic institutions, particularly through REITs and QIPs, is a significant trend, which is expected to persist as the REIT market continues to develop,” Pillai added.
The report emphasized an increasing proportion of domestic investors, with their involvement rising to 37% in 2024, compared to an average of 19% from 2019 to 2022. Pillai noted that the positive trend in REITs and QIPs is anticipated to persist as the sector maintains its strong recovery following the pandemic.
