Mumbai crosses $1 bn institutional real estate investments for 4th year as India totals $4.7 bn in M9 2025

Mumbai’s institutional investment story in real estate has come full circle, returning to pre-pandemic levels and crossing the $1 billion mark for the fourth year in a row as it hit $1.2 billion in the first nine months of 2025, according to Cushman & Wakefield’s India Capital Markets Q3 2025 report. 

At the national level, institutional investment inflows (across private equity and REITs) reached $4.7 billion year-to-date, and the sector seems poised to close the year with around $6–6.5 billion. This will make 2025 potentially the second-best year on record for institutional investments in commercial real estate. 

Domestic institutional participation has grown significantly over the past few years, accounting for 48% of inflows between January and September, up from a smaller share previously. Foreign investors contributed the remaining 52%. This shift has helped offset volatility in cross-border capital flows and strengthened the market’s stability, according to the report. 

For institutional investors, office assets remain the dominant choice for investors, accounting for 35% of YTD inflows, followed by residential (26%), retail (12%), and logistics & industrial (9%). 

Even amid global uncertainty, institutional capital has found stability in India’s economic fundamentals, domestic demand, and governance frameworks, says Somy Thomas, Executive Managing Director, Capital Markets, Cushman & Wakefield. “The growing participation of domestic investors, who now contribute the majority share of quarterly inflows, underscores the market’s maturity and confidence in India’s long-term growth story,” says Thomas.

Investment in the real estate sector in the south also remains very strong, says Vivek K. Chandy, Joint Managing Partner at JSA Advocates & Solicitors. "Bangalore developers have not just moved to the growing and large cities in the south, but have started huge developments in Mumbai and the NCR.  While the equity markets provided huge returns following the pandemic, over the last year, the bigger returns have probably been from investments in real estate."

 Foreign capital accounts for two-thirds of Mumbai’s inflows

Foreign capital accounted for two-thirds (67%) of Mumbai’s inflows at $797.7 million, led by investors from the United States ($500 million) and Japan ($297 million), signalling confidence in the city’s fundamentals. Domestic investors contributed the remaining $398 million.

Across asset classes, the residential segment attracted $377.6 million in inflows, largely driven by redevelopment projects, followed by the office sector with $339.71 million, which benefitted from continued occupier resilience and renewed leasing activity. The logistics and industrial segment received $269.3 million. Mixed-use commercial projects (including office, hospitality and projects) saw inflows of $155 million and data centres attracted $54.6 million. 

Reasons behind Mumbai’s strong investment run

Mumbai’s sustained investment run is closely tied to its ongoing infrastructure transformation. Landmark projects such as the Mumbai Trans Harbour Link (Atal Setu), Mumbai Coastal Road, Metro network expansion, and the upcoming Navi Mumbai International Airport are reshaping connectivity and urban mobility, enhancing the city’s attractiveness as an investment destination. This large-scale infrastructure spend has not only unlocked new micro-markets but also strengthened investor conviction in the city’s long-term growth narrative.

“This resilience reflects strong fundamentals, infrastructure-led growth, and a diversified asset base that continues to attract both foreign and domestic capital,” said Thomas.

Outlook remains positive for commercial real estate 

YTD-2025 institutional investments have crossed 68% of the overall activity recorded in 2024, which was a record year, suggesting a positive momentum for commercial real estate investments. The REIT market, too, is reflecting this sentiment as all listed office REITs have delivered better returns (9-29%) than the BSE Realty Index (-20%) in the last 12 months. 

"As per India’s REIT association, we can expect ~one REIT listing a year, depending on market conditions and portfolio consolidation. With GDP growth outlook revised upwards and inflation likely to remain benign in the near-to-medium term, the market is poised for a healthy momentum on the back of a stable economy," the Cushman report stated.