FreepikDomestic investors emerge as India's new CRE capital
A USD 3 trillion wealth boom is fuelling a domestic capital shift, with Indian family offices emerging as key players in the CRE
November 11, 2025Real Estate
Written by:Jorge Aguinaga
Key Takeaways
- Domestic capital is actively replacing foreign dominance, a trend proven by the latest REIT which was fully subscribed by local rather than international investors.
- A USD 3 trillion domestic stock market boom has created a new class of powerful Indian family offices who are now bidding on and acquiring major assets independently.
- The next significant wave of capital is expected from domestic pension funds and insurance companies, which are only now beginning to build the frameworks to invest.
A fundamental transformation is underway in India's commercial real estate market (CRE), defined not just by what is being bought but by who is doing the buying.
While for years the largest transactions were dominated by foreign institutional capital, a powerful new wave of domestic capital is now rising, with Indian family offices and institutional funds replacing foreign dominance.
This is not a cyclical trend but a structural shift, and one that foreign investors themselves see as a sign of a more mature and sustainable CRE market.
In a stark contrast, the fourth and latest REIT saw less than 11% subscription from foreign investors because that IPO was fully subscribed by the domestic market, a clear demonstration that Indian investors now have the conviction to back the sector.
These are not small players, as top-tier family offices are now seen bidding INR 500-700 crores at a time. It is estimated that the top 20 to 50 family offices in India now possess the affordability and the mindset to acquire a single, large-scale asset worth INR 2,000 to 2,300 crores entirely on their own.
Crucially, this USD 3 trillion in new wealth has mostly gone to domestic investors while foreign investors were net sellers, creating a vast pool of domestic wealth that is now hungry for product innovation and seeking to diversify beyond traditional assets.
Although policy technically allows them to invest up to 5% of their listing, they have historically lacked the right attitude and approach or framework to do so.
That is now changing, as these institutions are finally starting to come up with a policy framework. Once these sleeping giants enter the market, the amount of domestic capital available for real estate is set to be huge.
These strategic insights were shared during the panel discussion on "Commercial Real-Estate Strategies - Investment Outlook for Core, Core-Plus & Alternative Assets".
The session was moderated by Shobhit Agarwal, MD & CEO at ANAROCK Capital, and featured reflections from leading experts including Anshu Kapoor, President and Head at Nuvama; Manish Swaroop, CEO at Signature Global; Sunil Varrier, Chief Acquisition Officer at Table Space; and Vithal Suryavanshi, CEO- Commercial at Phoenix Mills.
Access all takeaways and C-level insights in the exclusive India GRI 2025 Spotlight report.
While for years the largest transactions were dominated by foreign institutional capital, a powerful new wave of domestic capital is now rising, with Indian family offices and institutional funds replacing foreign dominance.
This is not a cyclical trend but a structural shift, and one that foreign investors themselves see as a sign of a more mature and sustainable CRE market.
REITs signal a clear shift in investor conviction
The most telling evidence of this shift comes from India's REIT market, where the country's first REIT saw 69% of its shares subscribed by foreign institutional investors.In a stark contrast, the fourth and latest REIT saw less than 11% subscription from foreign investors because that IPO was fully subscribed by the domestic market, a clear demonstration that Indian investors now have the conviction to back the sector.
Panellists during India GRI 2025 agree that domestic capital participation is rising, with family offices and institutional funds actively beginning to replace foreign dominance in key transactions. (GRI Institute)
The new power player: India's family offices
This domestic surge is being led by a new and formidable force: the Indian family office. Over the last two years, single family offices have moved from the sidelines to become some of the most aggressive bidders for major assets, in some cases placing the second-highest bids, just behind major sovereign funds.These are not small players, as top-tier family offices are now seen bidding INR 500-700 crores at a time. It is estimated that the top 20 to 50 family offices in India now possess the affordability and the mindset to acquire a single, large-scale asset worth INR 2,000 to 2,300 crores entirely on their own.
The USD 3 trillion boom fuelling domestic CRE investment
This new wave of capital is the direct result of a massive wealth creation event in India's public markets, where between March 2020 and March 2025, the total stock market capitalisation exploded from USD 2.1 trillion to USD 5.3 trillion.Crucially, this USD 3 trillion in new wealth has mostly gone to domestic investors while foreign investors were net sellers, creating a vast pool of domestic wealth that is now hungry for product innovation and seeking to diversify beyond traditional assets.
The next wave of domestic pension funds and insurance capital
While family offices are the story of this real estate investment cycle, an even larger amount of capital is waiting on the horizon from India's own domestic insurance companies and pension funds.Although policy technically allows them to invest up to 5% of their listing, they have historically lacked the right attitude and approach or framework to do so.
That is now changing, as these institutions are finally starting to come up with a policy framework. Once these sleeping giants enter the market, the amount of domestic capital available for real estate is set to be huge.
These strategic insights were shared during the panel discussion on "Commercial Real-Estate Strategies - Investment Outlook for Core, Core-Plus & Alternative Assets".
The session was moderated by Shobhit Agarwal, MD & CEO at ANAROCK Capital, and featured reflections from leading experts including Anshu Kapoor, President and Head at Nuvama; Manish Swaroop, CEO at Signature Global; Sunil Varrier, Chief Acquisition Officer at Table Space; and Vithal Suryavanshi, CEO- Commercial at Phoenix Mills.
Access all takeaways and C-level insights in the exclusive India GRI 2025 Spotlight report.