Foreign real estate investment in India grew by 134% year-on-year in Q3 2026, reaching $1.4 billion. International investors are once again leading the market after four consecutive quarters in which local capital dominated. This is according to the latest Capital MarketBeat report by international consultancy Cushman & Wakefield.
Total institutional investment in the sector reached $2.1 billion between July and September, up 20% year-on-year and 12% from the second quarter of 2026.
Foreign investors provided 68% of the investment, while Indian institutional investors contributed $700 million, or 32% of the total.
On a quarterly basis, foreign investment increased by 64%, while domestic investment decreased by 34%. On an annual basis, the decline among Indian investors reaches 39%, after relatively high levels of investment activity in previous periods.
Data centers overtook traditional real estate
The greatest interest among investors is caused by data centers, which attracted 52% of all institutional investments in the third quarter. This corresponds to approximately $1.1 billion.
The sector is climbing to first place among investment segments, overtaking traditional office space and hotel properties.
The main drivers of this growth are the rapid development of artificial intelligence, the increasing use of cloud services and the need to store and process ever-increasing volumes of information.
The hotel sector has attracted 15% of institutional investments, while office real estate has received 9%.
According to analysts at Cushman & Wakefield says the growing interest in data centers reflects investor confidence in the long-term potential of India's digital infrastructure.
Investments hit $5.5 billion in nine months
For the period January-September 2026, the total volume of institutional real estate investments in India reached $5.5 billion, which is 11% more than the corresponding period in 2025.
Despite the return of foreign capital in the third quarter, domestic investors maintained a slight advantage in the first nine months of the year. They accounted for 52% of all investments, while international investors formed the remaining 48%.
Investments by Indian institutions grew by 15% year-on-year, and those by foreign investors – by 8%.
The data shows that despite global economic uncertainty, the Indian real estate market continues to attract significant capital.
Mumbai and Delhi remain leading investment centers
Investors are increasingly preferring deals covering real estate in several cities, rather than concentrating their capital in just one market.
Such investments accounted for 76% of total activity in the third quarter.
Among individual city markets, Mumbai attracted 9% of investments, followed by the Delhi metropolitan region with 6%.
This trend indicates a desire to diversify investment portfolios and limit risk by acquiring assets in different economic centers.
Private investment funds were the main source of institutional capital, providing 88% of investments. The remaining 12% was realized through real estate investment trusts (REITs).
According to Somi Thomas, Executive Managing Director „Capital Markets“ at Cushman & Wakefield, the Indian market has demonstrated resilience despite international economic uncertainty.
He points out that investors continue to be selective, directing their capital to projects with large scale and long-term growth prospects.
The increased participation of foreign investors confirms the attractiveness of the Indian market and the diversity of investment opportunities in individual segments.
From Cushman & Wakefield expects private equity funds and real estate investment trusts to continue expanding their portfolios through strategic acquisitions.
Data centers, office buildings and other types of commercial real estate remain particularly promising, benefiting from the development of the Indian economy and the growing demand for modern infrastructure.
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