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PE Investments in Real Estate: Fewer Deals But Higher Value in 9M FY25


Mumbai, January 13, 2025: The private equity (PE) landscape in Indian real estate for the first nine months of FY25 reveals a shift despite declining deal numbers. ANAROCK Capital’s FLUX – 9M FY25 edition finds that although PE deals dropped from 30 in 9M FY24 to 24 in 9M FY25, the total investment value rose 6 per cent to $2.82 billion. This growth was significantly influenced by the high-profile Reliance-ADIA/KKR warehousing deal, which skewed the overall financial metrics.


“The average deal size saw a notable increase of 32.5 per cent, climbing from $88.5 million in 9M FY24 to $117.3 million in 9M FY25,” says Shobhit Agarwal, MD & CEO – ANAROCK Capital. “This jump underscores the impact of large-scale transactions on the market, with the top 10 deals comprising 93% of total PE transactions.”
Led by the Reliance–ADIA/KKR transaction, the top 10 deals accounted for a massive 93 per cent of the total transactions for the nine months ended December 31, 2024.
Leading the chart was the Reliance-ADIA/KKR warehousing deal worth $1.54 billion. “This deal, along with the $204 million Blackstone-LOGOS equity deal, significantly boosted the logistics and warehousing sector, which captured 62 per cent of total investment,” says Agarwal.
Given the hybrid nature of the outsized Reliance-ADIA/KKR deal, hybrid transactions accounted for 55 per cent of the total transactions in the period. Debt accounted for 24 per cent, and equity accounted for the remaining 21 per cent in this period.
Multi-city deals dominated the transaction table in 9M FY25, led by the Reliance-ADIA / KKR transaction – which, along with two other multi-city deals, pushed the tally to over 62 per cent. In terms of cities, Bengaluru and Hyderabad led the transaction tables with 11 per cent and 10 per cent deal shares, respectively.
Pure debt and equity transactions remained relatively scarce with the hybrid Reliance – ADIA / KKR deal remaining the dominant one in the period. Domestic and foreign investors broadly maintained the same funding proportions as the previous year(s).
In the first nine months of FY25, the industrial and logistics sector captured 62 per cent of total investments, significantly surpassing both the office and residential sectors, which attracted 14 per cent and 15 per cent respectively.


“The fact that the share of private equity investment in the residential sector rose to 15 per cent, up from 12 per cent in the same period last year reflects the increased activity in the housing market,” says Aashiesh Agarwaal, SVP – Research & Investment Advisory, ANAROCK Capital. However, stronger pre-sales and higher participation from PSU banks in construction finance may reduce the demand for high-cost private equity financing. This may require PE funds to get into earlier stages of project lifecycles to maintain IRRs, or to engage in special situations investments.”
While Indian commercial real estate markets saw strong leasing, this segment saw muted PE activity due to geopolitical concerns and high interest rates, which impacted valuations. That said, the sector’s strong operational performance is likely to continue, and an expected decline in interest rates will revive PE investments in the space.
The industrial and logistics sector remains highly attractive to investors, thanks to strong growth primarily driven by manufacturing, e-commerce, consumer demand, and third-party logistics (3PL). This growth is further amplified by a shift from Grade-B to Grade-A properties, reflecting a growing focus on quality, large formats, and environmental, social, and governance (ESG) considerations. Investor interest in warehouses remains strong, supported by a steady supply of investment-grade properties and sustained demand from institutional investors and high-net-worth individuals.
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