Despite a 41% year-on-year (YoY) decline in total private equity (PE) investments into Indian real estate, Mumbai emerged as the top destination, attracting USD 468 million in H1 2025, according to Knight Frank India’s latest report. The total PE investment across the country stood at USD 1.7 billion, down from USD 2.96 billion in H1 2024, spread across just 12 deals compared to 24 last year.
🏢 H1 2025 Real Estate PE Inflows by City (USD Million)
| City | PE Inflows (USD mn) |
|---|---|
| Mumbai | 468 |
| Bengaluru | 453 |
| Kolkata | 374 |
| Hyderabad | 259 |
| Pune | 134 |
| Chennai | 50 |
“The current global economic environment marked by persistent inflation and tighter monetary conditions has led many Western funds to take a cautious stance,” said Shishir Baijal, CMD, Knight Frank India. “Yet Mumbai continues to attract capital due to its strong real estate fundamentals.”
📉 Sector-wise Trends: Office Assets Shine, Warehousing Dips
While overall capital inflow dipped, sectoral performance varied significantly:
PE Investment by Segment (H1 2025)
| Segment | PE Inflows (USD mn) | YoY Change |
| Office | 706 | +22% |
| Residential | 500 | -41% |
| Retail | 481 | +100%+ |
| Warehousing | 50 | -97% |
The office sector led PE activity with USD 706 million, growing 22% YoY. Mumbai was a key hub for these investments, especially in Grade A commercial assets with strong cash flows and long-term leases.
“Rather than broad-based exposure, investors focused on high-quality, stabilised or REIT-ready office properties,” said the report.
On the contrary, warehousing saw a major pullback, receiving only USD 50 million—its lowest since 2018.
💎 Residential Investments: Mumbai Draws USD 115 Million
Mumbai attracted USD 115 million in PE for residential real estate, placing it third behind Bengaluru and Pune.
Residential PE Investments by City (USD Million)
| City | PE Inflows (USD mn) |
| Bengaluru | 215 |
| Pune | 134 |
| Mumbai | 115 |
| Hyderabad | 21 |
| Chennai | 15.1 |
A key trend was the return of debt-driven instruments, with 60% of residential investments via credit structures, as investors prioritized collateral-backed risk mitigation.
🌎 Why Mumbai Leads: Key Takeaways
- Prime office locations with high absorption rates
- Consistent demand in mid-to-premium residential segments
- Institutional investor familiarity and REIT-ready projects
- Strategic location advantage and deep capital markets
“As macroeconomic conditions in the West stabilize, global capital is likely to return, with Mumbai remaining a key entry point for institutional investors,” added Baijal.
Also Read: India’s Office Boom Narrows to 15 Hotspots
