Office Sector and Data Centers Drive USD 1.9 Billion Real Estate Investments in Q2 2026: Cushman & Wakefield
Gurugram, July 26, 2026: Institutional investments in India’s real estate sector reached USD 1.9 billion during the second quarter of 2026, marking a 16 percent increase quarter-on-quarter, according to Cushman & Wakefield’s Q2 2026 Capital Marketbeat report. Total institutional inflows for the first half of 2026 reached USD 3.5 billion, a 6 percent rise over H1 2025. The market’s resilience was primarily underpinned by strong domestic investor participation and sustained demand for stable income-generating assets despite broader global economic uncertainties.
The office segment led investment volumes for the fourth consecutive quarter, capturing nearly USD 1 billion—or 51 percent—of total institutional capital in Q2 2026. This activity was sustained by strong occupier demand from Global Capability Centres (GCCs), tightening vacancy rates in key markets, and rental growth in core micro-markets. Data centers emerged as the second-largest recipient, securing 40 percent of overall investments during the quarter due to rising demand for digital infrastructure powered by AI adoption, cloud expansion, and data localization mandates.
Domestic capital remained the primary driver for the fourth straight quarter, representing 54 percent of total investments in Q2 2026 and 64 percent (USD 2.2 billion) for H1 2026. In contrast, foreign institutional deployment stood at USD 1.3 billion (36 percent) in the first half of the year, down from 57 percent during the same period in 2025. Multi-city portfolio transactions accounted for 55 percent of capital deployment in Q2 2026, while Bengaluru led individual city allocations with a 23 percent share, followed by Chennai at 17 percent. Private equity sources contributed 85 percent of total institutional capital during the quarter, with REITs providing the remaining 15 percent.
“Capital allocation is becoming increasingly differentiated across asset classes. While office continues to attract a broad spectrum of investors owing to its maturity, liquidity and stable income profile, we are also seeing growing interest in the data centre segment as investors seek to capitalise on India’s expanding digital infrastructure ecosystem. This diversification of capital is contributing to a deeper and more resilient investment landscape. At the same time, investors are increasingly pursuing portfolio and multi-city opportunities to achieve greater scale and diversification. With domestic fundraising remaining healthy and significant capital available for deployment, we expect investment activity to remain resilient through the second half of 2026, with domestic investors continuing to anchor market momentum,” said Somy Thomas, Executive Managing Director, Capital Markets, Cushman & Wakefield.
