GDP Growth Improves; Positive Momentum in Real Estate Investments
India’s GDP grew by 7.8% in Q2-25, marking a five-quarter high, driven by front-loaded government spending and exports ahead of increased US tariffs coming into effect. Inflation eased to 2.07% in August, and the MPC of the RBI voted to maintain the policy repo rate at 5.50%, while raising the growth forecast for current fiscal year. Institutional real estate investments in Q3-25 totaled USD 1.4 Bn, down 30% q-o-q. YTD-25 investments reached USD 4.7 Bn, with foreign and domestic investors contributing equally. Office assets led with 57% of inflows, followed by Residential and Education (14% each). Core asset acquisitions dominated with 65% share, followed by 19% for under-construction projects and 16% for early-stage investments.
Q3-25 fundraising totaled USD 1.4 Bn, up 46% q-o-q, with office-focused funds/REITs capturing 81% share. SEBI’s classification of REITs as equity instruments is expected to boost liquidity and investor participation. YTD-2025 institutional investments have reached 68% of 2024’s record levels, signaling positive momentum. With GDP growth revised upwards and inflation under control, the market is set for sustained growth.
