India’s Real Estate in 2025: A Look Back — and What 2026 May Bring

India’s real estate story in 2025 can be summed up in one phrase: steady performance, led by “quality” demand. Residential stayed resilient (even as volumes cooled in some datasets), office leasing hit new highs thanks to GCCs and flex, and industrial/logistics kept expanding on the back of 3PL, e-commerce and manufacturing-linked supply chains.

Below is a segment-wise look back at 2025, and a grounded 2026 outlook based on what major real estate consultancies, rating agencies, and market reports are saying.

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The big picture: what held up the market in 2025

A few forces cut across segments:

• Premiumisation in housing: demand increasingly tilted toward higher ticket sizes, while affordable/mid segments stayed selective in some cities.
• “Flight to quality” in offices: green-certified, well-located Grade A assets captured a disproportionate share of leasing.
• Logistics expansion stayed structural: 3PL and large-format requirements kept absorption healthy, even when quarters fluctuated.
• Rates and liquidity turned supportive late in the year, improving sentiment and affordability math (especially for end-users).

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Residential in 2025: steady demand, more “value” than “volume”

Different trackers tell slightly different stories, but the combined signal is consistent: housing demand remained healthy, and the premium segment did the heavy lifting.

What happened in 2025

• Sales and launches stayed broadly balanced in the first nine months (a sign that the market didn’t overbuild into weak absorption). CBRE notes both sales and launches crossed 200,000 units in Jan–Sep 2025.
• Overall unit sales softened in some estimates, but not because demand vanished—rather because the market composition shifted upward:
  • JLL reports Jan–Sep 2025 sales fell 12% YoY to 202,756 units, yet homes priced ₹1 crore+ (₹10 million+) grew 4% YoY, with premium share rising materially.
• Premium homes gained share in buyer preference, with the market increasingly driven by end-users upgrading and higher-income demand.

What that means

2025 looked less like a speculative spike and more like a maturing cycle: fewer “panic buys,” more amenity + connectivity + developer brand driven purchases.

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Office in 2025: record absorption, powered by GCCs and flex

If residential was “steady,” offices were the headline performer in 2025.

What happened in 2025

• JLL reports ~40 mn sq ft net absorption in Jan–Sep 2025 (highest ever for that 9M period) and 56.5 mn sq ft gross leasing.
• CBRE similarly notes ~60 mn sq ft office leasing in Jan–Sep 2025, also described as a record for the first nine months.
• GCCs remained central: JLL puts GCCs at 35.5% of gross leasing in Jan–Sep 2025 (20 mn sq ft).
• Vacancy tightened in key markets as demand outpaced supply in “good” assets (even if city-level churn kept overall vacancy rangebound). JLL recorded top-7 vacancy at 15.7% (down QoQ).

What that means

Hybrid didn’t kill offices in India—it reshaped them. 2025 demand was increasingly about talent access, modern campuses, sustainability, and flexibility.

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Industrial & logistics in 2025: resilient absorption, 3PL still leads

The industrial/warehousing segment stayed a high-conviction story—less flashy than office, but consistently expanding.

What happened in 2025

• Colliers reported ~20 mn sq ft Grade A industrial & warehousing demand in H1 2025, up 33% YoY, with 3PL contributing ~32% of demand.
• By Oct 2025, Colliers noted 26.5 mn sq ft demand in the first 9 months of 2025, up 11% YoY—even though Q3 moderated after a very strong Q2.
• Supply remained active, with Colliers pointing to ~19 mn sq ft new supply in H1 2025 (+11% YoY) and expectations of substantial completions through the year.

What that means

This segment is increasingly tied to long-duration themes: e-commerce/q-commerce, organised retail supply chains, manufacturing, and formalisation of logistics.

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The money lens: rates, investments, and REIT momentum

Capital conditions matter because they shape affordability (residential) and cap rates (commercial).

• In December 2025, ICRA noted the MPC cut the repo rate by 25 bps to 5.25%, alongside durable liquidity measures—supportive for credit transmission.
• On institutional capital: Colliers (via reporting) expects $5–7 bn annually in 2025 and 2026, with $4.3 bn already recorded in the first 9 months of 2025.
• REIT/InvIT distributions also showed strength in FY2026 so far, supported by operating metrics across asset types, per ICRA Analytics coverage.

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Outlook for 2026: what experts are forecasting next

Most mainstream forecasts for 2026 converge on a base case of continued growth, but more selective—rewarding good product, good locations, and execution discipline.

Office 2026: GCCs + flex deepen the cycle

Colliers’ India view (reported by Business Standard) sketches a constructive 2026:

• Grade A demand may reach ~70 mn sq ft, with rentals rising 5–10% amid limited new supply and stable vacancies.
• Annual leasing could stabilise around 70–75 mn sq ft, with GCC leasing potentially 30–35 mn sq ft (40–50% of Grade A demand).
• Flex could contribute ~20% of leasing, and new supply is expected to be largely green-certified.

My takeaway: 2026 looks like a “scale-up year” for the office thesis—especially for Bengaluru, NCR, Pune, Hyderabad, Chennai—plus growing spillover into select Tier-II hubs.

Residential 2026: steady demand, premium remains important

The likely shape of 2026 housing:

• A stable-to-positive year where demand is supported by income growth, infrastructure-led connectivity, and (potentially) easier borrowing conditions.
• Continued premium/aspirational strength and lifestyle formats (larger homes, plotted, gated communities) where land and approvals allow supply.

Watch-outs: affordability in overheated micro-markets, project delivery risk, and the possibility that volume growth stays modest even if value grows.

Industrial & logistics 2026: expansion continues, formats diversify

Colliers-linked commentary points to another year of growth, driven by 3PL acceleration and new warehousing formats (including more in-city nodes for faster delivery).

My takeaway: 2026 could be less about “more of the same large sheds” and more about a mix of regional distribution + urban fulfilment + sector-specific warehousing (electronics, cold chain, etc.).

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What to watch in 2026 (practical themes)

If you’re a homebuyer

• Prioritise execution + developer track record over headline discounts.
• Track mortgage rates and liquidity—even small moves change long-tenure affordability.

If you’re an office occupier

• Expect premium Grade A to stay firm; negotiate using lease structuring (fit-out contributions, phased take-up) rather than only rent.

If you’re an investor

• The market is increasingly “barbelled”: best-in-class assets do well, weak assets lag.
• REIT/InvIT channels and broader institutional participation are becoming more important to price discovery.

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Bottom line

2025 validated that India real estate is in a sturdier cycle than the last decade’s boom-bust patterns—premium residential held up, offices surprised on the upside, and industrial stayed structurally strong.

2026 is shaping up as a continuation year: steady, selective, and quality-led—with GCCs, flex, logistics upgrades, and infrastructure connectivity acting as the key accelerants.