India’s office market continued to attract global institutional capital in the first half of 2026, with Delhi-NCR emerging as the biggest investment destination as Global Capability Centre (GCC) expansion drove demand for income-generating office assets, according to Knight Frank India.
The property consultancy said private equity (PE) investments in Indian real estate stood at $1.13 billion in H1 2026, down 23% from $1.47 billion a year earlier. Despite the decline, office assets accounted for nearly 89% of total investments, while Delhi-NCR attracted the highest inflows among the country’s top eight property markets.
What’s driviing GCC expansion
Knight Frank India highlighted that elevated global interest rates, tighter financial conditions and geopolitical uncertainty have prompted institutional investors to focus more on execution certainty, liquidity and risk-adjusted returns.
However, “the moderation in private equity investments during H1 2026 is largely a reflection of the evolving global capital environment rather than any deterioration in India’s real estate fundamentals,” said Shishir Baijal, International Partner, Chairman and Managing Director, Knight Frank India.
“Despite these challenges, India’s office market continues to demonstrate remarkable resilience, supported by sustained GCC expansion, strong occupier demand and an increasing stock of institutional-grade assets,” Knight Frank’s Shishir Baijal added.
Delhi-NCR tops investment charts
Delhi-NCR received $411.1 million in private equity investments during H1 2026, a 522% year-on-year increase from $66 million a year ago. The region accounted for more than one-third of total PE inflows, driven by a mix of office and residential transactions, expanding infrastructure, a growing corporate occupier base and a deep pipeline of institutional-grade assets.
Delhi-NCR Tops Real Estate PE Inflows
GCC expansion fuels demand for ready office assets in H1 2026
Total PE Investment
$1.13B
| Top Cities | PE Inflows |
|---|---|
| Delhi-NCR | $411.1M |
| Pune | $355.9M |
| Chennai | $154.7M |
| Bengaluru | $115.9M |
| Mumbai | $84.3M |
- Office assets attracted 89% of PE investments.
- 75% of office investments went into ready properties.
- GCC expansion remains the biggest driver of institutional office demand.
Express InfoGenIE
Pune followed with investments of $355.9 million, supported by residential transactions and its expanding office and manufacturing ecosystem. Chennai attracted $154.7 million, while Bengaluru received $115.9 million on the back of continued GCC expansion and its position as India’s largest technology and office market. Mumbai recorded inflows of $84.3 million and Hyderabad attracted $4.3 million.
Office assets dominate investment activity
Knight Frank India said office properties remained the preferred investment destination, with PE inflows into the segment rising 33% year-on-year to $997.8 million from $579 million in H1 2025. The office sector alone accounted for nearly 89% of all real estate PE investments during the period.
The consultancy attributed the strong performance to sustained demand from GCCs, multinational corporations and domestic companies. India’s skilled talent pool, cost competitiveness and growing strategic role in global corporate operations continued to support leasing across major office markets, it said.
Investors also showed a clear preference for completed office assets. Around 75% of office investments went into ready properties during H1 2026, up from 53% a year earlier, reflecting greater preference for stable cash flows and lower execution risk in a higher interest-rate environment.
Higher global rates reshape capital allocation
Knight Frank India said higher global interest rates have narrowed India’s yield advantage over developed markets, leading investors to become more selective.
The spread between India’s 10-year government bond yield and the US 10-year Treasury yield narrowed from about 440 basis points during 2020-21 to around 240 basis points in H1 2026. At the same time, US Treasury yields increased from around 1.8% in 2021 to about 4.4% in H1 2026, raising investors’ required return threshold for Indian investments from roughly 8.6% to nearly 11.5%.
According to the consultancy, currency movements, taxation, project delays, leasing risk and exit certainty now play a much larger role in investment decisions than they did during the low interest-rate cycle.
Residential investments remain selective
Private equity investment in residential real estate fell to $128.2 million during H1 2026 from $297 million a year earlier as investors remained selective toward development-led projects. Even so, Knight Frank India said the housing market continues to benefit from stronger developer balance sheets, increasing formalisation and healthy end-user demand.
Debt structures accounted for a significant share of residential investments as investors preferred instruments that offered greater downside protection. Delhi-NCR, Pune and Mumbai accounted for most residential PE inflows during the period.
Warehousing, retail see investment pause
The warehousing and retail segments did not record any major PE transactions during H1 2026. Knight Frank India said the absence of deals should not be interpreted as weakening fundamentals, adding that both sectors continue to have favourable long-term demand drivers.
Conclusion
Knight Frank India expects urbanisation, economic growth, institutionalisation and an expanding stock of investment-grade assets to support India’s long-term investment outlook.
While global capital is likely to remain selective in the near term, Knight Frank pointed out that these sectors with strong occupier demand, stable income streams and transparent governance frameworks should continue attracting institutional investors.
