PE investments in Indian real estate up 23% to $2.7b in H1

Private equity (PE) investment in Indian real estate has staged a strong recovery, with inflows rising 23 per cent year on year to $2.7 billion in H1 FY27 (April to September 2026), up from $2.2 billion in the same period last year, according to the latest FLUX report by Anarock.

This is the strongest first half since H1 FY23 and follows three years of easing, despite continued geopolitical tensions and high global interest rates.

The half-year inflows already account for about 63 per cent of the $4.3 billion invested in the whole of FY26.

Deal activity was also broader, with 30 transactions recorded in H1 FY27 against 22 a year earlier, while the average deal size rose 18 per cent to $91 million.

“The first half of FY27 marks a clear turning point for private equity in Indian real estate. Investors are no longer just testing the waters; they are committing larger cheques, taking equity positions, and backing scalable platforms.

“The fact that this has happened against an uncertain global backdrop shows that India is now seen as a core, long-term allocation rather than an opportunistic bet,” says Shobhit Agarwal, CEO, Anarock Capital.

The standout trend of H1 FY27 is the rise of domestic capital.

Domestic investors deployed about $1.3 billion across 24 deals — nearly six times the $220 million invested in H1 FY26 — and accounted for 48 per cent of total inflows. Just two years ago, in FY25, their share stood at only 16 per cent.

Foreign investors, meanwhile, invested about $1.4 billion across six deals, up 19 per cent year on year.

While domestic investors led by number of deals, foreign investors wrote far larger cheques, averaging about $238 million per deal compared with about $54 million for domestic investors.

“The depth of domestic capital is the biggest structural change we are seeing. Real estate AIFs, family offices and domestic institutions now have the scale and conviction to lead large transactions. Importantly, this growth is additive.

Foreign capital has not retreated; domestic money has simply added a strong new layer of funding, which makes the market far more resilient to global shocks,” adds Shobhit Agarwal.

Office remained the largest asset class, attracting 35 per cent of inflows, almost unchanged from 36 per cent in FY26, as investors continued to buy completed, leased Grade A assets for stable rental income.

The sharpest shift came from new-age assets — data centres jumped to 29 per cent of inflows from just 4 per cent in FY26, driven by large-ticket foreign platform investments. Hospitality took 12 per cent after recording no deals in the previous year.

Residential took 14 per cent of inflows but led by deal count, with nearly 90 per cent of residential capital coming through structured debt for project completion. Industrial & logistics took 6 per cent, while retail saw no PE deals in the half due to a shortage of new Grade A mall supply.

Multi-city platforms take nearly half of all capital Investors increasingly backed platforms spanning several cities rather than single assets. Pan-India and multi-city deals took 49 per cent of inflows in H1 FY27, up from 18 per cent in FY26.

Among individual cities, Bengaluru led with 17 per cent, up from 13 per cent, while Pune nearly doubled its share to 11%. NCR and MMR, which together took 40% of inflows in FY26, saw their combined share fall to 16%.

Can NRIs invest in agricultural land in India. What are the implications in respect of violation? Arvind Kumar, Sharjah.

Under the FEMA, 2000 regulations, NRIs cannot directly buy or invest in agricultural land in India. However, agricultural land may be acquired by an NRI through inheritance from a resident Indian relative, by way of gift from a resident Indian relative and with special approval from the RBI, which is granted only in limited cases after scrutiny of FEMA compliance and State land laws.

I bought an apartment from a seller and later understood that he does not fully own it. What is the remedy available now? Deepika, Dubai.

You cannot claim exclusive possession, cannot evict other co-owners, and cannot deal with the property as its absolute owner. A legal notice can be issued to the co-owner specifying that the property is disputed. Under Order 39 Rules 1 and 2 of the Code of Civil Procedure, 1908, a civil court can grant a temporary or permanent injunction restraining a sale.