Curation Team
NEW DELHI: Private equity (PE) investments in India’s real estate sector continued to moderate in the first half of FY26, with overall inflows down 15% year-on-year compared to the same period last year, according to a report by Anarock Capital.
Total PE inflows stood at USD 2.2 billion in H1 FY26, down from USD 2.6 billion in H1 FY25. While the number of transactions declined, average deal sizes remained steady, ranging between USD 60–100 million.
“A stronger deal showing in Q1 FY26 appeared to present a glimmer of hope, though it was short-lived as activity subsided again going into the second quarter. When viewed on a full year basis, PE activity has been on a steady decline from the high of USD 6.4 billion seen in FY21 to USD 3.7 billion in FY25. While it is tempting to look at the H1 FY26 tally of USD 2.2 billion with positivity, it bears keeping in mind that overall activity for H1 FY26 is down 15% on a year-on-year basis, compared to H1 FY25,” said Shobhit Agarwal, CEO of the company.
Deal concentration eases; fewer outsized transactions
The share of the top 10 PE deals fell to 77% of total activity in H1 FY26, compared to 93% in the same period last year, reflecting a more evenly distributed deal flow.
“FY25 saw a few outsized transactions such as the Reliance–ADIA–KKR deal. In contrast, FY26 appears to be more balanced, with no single large deal skewing overall volumes,” said Aashiesh Agarwaal, senior vice president – Research & Investment Advisory, of the company.
MMR, Kolkata, and Chennai see higher activity
The Mumbai Metropolitan Region (MMR) and Kolkata recorded sharp increases in PE activity, together accounting for half of all transactions in H1 FY26.
MMR’s share surged from 12% to 33%, driven by the Kanakia–Hines–Mitsubishi–Sumitomo deal, while Kolkata’s share rose from 0% to 17%, led by Blackstone’s acquisition of South City Mall, for which ANAROCK was the transaction advisor.
Shift in asset class focus
Investment priorities shifted notably in H1 FY26, with retail, mixed-use, commercial offices, hotels, and data centres gaining traction.
The industrial and logistics segment, which dominated FY25 with a 47% share, saw no institutional transactions in the current period.
Equity share steady; foreign capital rebounds
Equity deals continued to dominate PE inflows, comprising 78% of total transactions in H1 FY26 — consistent with historical trends except for FY25, which was skewed by a large hybrid deal.
Meanwhile, foreign investors reclaimed a larger share of total capital, contributing 73% of inflows during H1 FY26, compared to 65% in FY25.
“We are seeing a gradual return of foreign capital, alongside growing collaboration between domestic and international investors,” Agarwal added.
Sectoral highlights
Residential: Consolidation continues amid softer launches and sales, though investor interest remains high, particularly for equity-led structures.
Commercial: Leasing activity stayed strong, led by Global Capability Centres (GCCs) and flex-space operators. USD 869 million worth of office assets were transacted in H1 FY26 — more than double the average of recent half-years.
Retail: Momentum remained strong, buoyed by robust operating metrics and major transactions by Nexus Select and Blackstone.
REITs: The period saw strong stock rallies (up 15–27%) and the listing of India’s fifth REIT — Knowledge Realty Trust, oversubscribed 12.5 times.
