India’s real estate sector recorded a total deal value of $2.5 billion in the first half (H1) of 2025, marking an 8% year-on-year decline, even as the number of transactions increased, according to the latest edition of the ‘Real Estate Q2 2025 Dealtracker’ released by Grant Thornton Bharat. The report underscores a shift in market dynamics, where higher deal volume has not translated into higher value.
Between January and June 2025, the sector witnessed 45 transactions, including Initial Public Offerings (IPOs) and Qualified Institutional Placements (QIPs), compared to 40 deals worth $2.7 billion during the same period in 2024. While the number of deals suggests a more active market, the lower cumulative value signals a move towards smaller-sized deals or more conservative valuations in a market still adjusting to post-pandemic recovery trends and interest rate sensitivity.
In the second quarter alone, the report highlights 17 transactions worth $1.3 billion, making up over half of the total half-yearly deal value. These deals include both public market activity and private investments, with IPOs and QIPs accounting for a significant share. The transaction activity indicates continued confidence in the capital markets as a route for fundraising, especially among real estate investment platforms and co-working firms looking to scale.
Despite the drop in overall deal value, analysts see signs of structural growth. India’s commercial office sector, particularly Grade A assets and flexible workspaces, remains a key focus area for both domestic and global investors. This is evident from the recent IPO activity by Smartworks and SEBI clearance for WeWork India’s Offer for Sale, both coming amid record high office leasing volumes—48.9 million sq. ft. leased in H1 2025 alone.
The residential and logistics segments also continue to attract institutional interest, but many of these deals are structured as joint ventures or platform-level commitments rather than outright acquisitions, leading to lower upfront transaction values. Developers are also increasingly turning to capital-light models and strategic land monetisation, which reflect in relatively smaller ticket sizes.
Grant Thornton Bharat’s report suggests that REITs (Real Estate Investment Trusts) and listed developer platforms may remain prominent channels for future deal activity. However, the shift toward efficient capital structures, reduced debt reliance, and operational profitability is changing the nature of transactions.
The subdued value figures could also be attributed to the cautious investment climate amid global macroeconomic uncertainties, including inflationary pressures, fluctuating interest rates, and currency volatility. While India remains a preferred long-term real estate investment destination, deal-making is becoming more selective and due diligence-driven.
Overall, the trend points toward a real estate sector that is more diversified in structure but cautious in capital allocation. The increase in deal count shows continuing appetite among investors and developers to engage in transactions, though valuations are being scrutinised more closely. The upcoming quarters may see a rebound in deal values if some of the delayed platform-level investments and large portfolio transactions close by the end of the calendar year.
