Private equity (PE) investments in Indian real estate grew 23 per cent year on year (YoY) to $2.7 billion in the first half of fiscal year 2027 (H1 FY27), according to a report by property consultancy firm Anarock. H1 FY27 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.
H1 FY27 recorded 30 transactions against 22 a year earlier, while the average deal size rose 18 per cent YoY to $91 million.
“H1 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,” said Shobhit Agarwal, chief executive officer, Anarock Capital.
According to the report, domestic investors deployed about $1.3 billion across 24 deals in H1 FY27 — nearly six times the $220 million invested in H1 FY26 — and accounted for 48 per cent of total inflows. In FY25, domestic investors’ share was at just 16 per cent.
Foreign investors, meanwhile, invested about $1.4 billion across six deals in H1 FY27, up 19 per cent YoY. 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, Anarock noted.
“The depth of domestic capital is the biggest structural change we are seeing. Real estate alternative investment funds (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,” said Prashant Thakur, executive director & head, research & advisory, Anarock Group.
Asset class-wise, offices attracted the most, with 35 per cent of the total PE inflows, compared to the 36 per cent share 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. Data centres’ share in the total PE inflow in Indian real estate jumped to 29 per cent in H1 FY27 from just 4 per cent in FY26, driven by large-ticket foreign platform investments.
The hospitality segment’s share stood at 12 per cent after recording no deals in the previous year.
The residential segment accounted for 14 per cent of inflows but led in deal count, with nearly 90 per cent of residential capital coming through structured debt for project completion.
Industrial and logistics’ share stood at 6 per cent, while retail saw no PE deals in H1 FY27 due to a shortage of new Grade A mall supply.
According to the report, investors increasingly backed platforms spanning several cities rather than single assets. Pan-India and multi-city deals took 49 per cent of the total inflows in H1 FY27, up from 18 per cent in FY26.
Among individual cities, Bengaluru led with a 17 per cent share, up from 13 per cent, while Pune nearly doubled its share to 11 per cent. The national capital region (NCR) and the Mumbai metropolitan region (MMR), which together took 40 per cent of inflows in FY26, saw their combined share fall to 16 per cent.
Anarock further observed that investor risk appetite has clearly improved. Equity made up 83 per cent of PE inflows in H1 FY27, the highest since at least FY23 and up from 77 per cent in FY26 and 68 per cent in FY23. Structured debt share has halved over the same period, from 32 per cent in FY23 to 16 per cent in H1 FY27, showing that investors are increasingly willing to take ownership positions rather than lend against projects.
Further, according to the report, if H2 FY27 inflows simply match those of H2 FY26, total PE investment in FY27 would reach about $4.8 billion, the highest in at least five years. The listing of a sixth real estate investment trust (REIT) — Bagmane Prime Office REIT — during the half has also deepened the market, giving private investors a stronger exit route and freeing up capital for fresh deals.
“We expect the momentum to continue into the second half. Strong office leasing, rising demand for data centres, and healthy hotel performance will keep institutional capital flowing. The key factor to watch is whether domestic investors can sustain more than $1 billion every half. If they do, FY27 could well become a record year for private equity in Indian real estate,” Agarwal added.