Office, Retail and Warehousing Offer New Opportunities as India’s Real Estate Market Matures: JLL
- IBEF
- November 3, 2026
India’s commercial real estate market is entering a new phase of growth, with office, retail and warehousing sectors offering fresh opportunities for institutional investors, according to a report by JLL titled A Decade of Change: The Institutionalization of Commercial Real Estate in India. The sector has attracted approximately Rs. 7.41 lakh crore (US$ 78 billion) in institutional capital since 2014, with office assets accounting for 46% of investments. Despite capitalization rates (cap rates) compressing to historic lows, the market continues to offer double-digit unlevered internal rates of return (IRR) over a typical five-year investment period. Between 2016 and Q3 2026, cap rates declined by 270 basis points in office, 320 basis points in retail and 250 basis points in warehousing. JLL noted that future returns will increasingly depend on rental income growth, strategic asset selection and operational efficiencies rather than further cap rate compression.
The office segment offers opportunities across approximately 500 million square feet of institutional-grade inventory and nearly 200 million square feet of non-premium stock available for repositioning. India’s Grade A office space increased from 439 million square feet in 2014 to 952 million square feet in Q3 2026, with Global Capability Centres (GCCs) accounting for over 40% of office leasing during the past decade. In retail, around 60% of nearly 50 million square feet of premium stock remains under non-institutional ownership, creating acquisition opportunities. Meanwhile, warehousing has attracted growing investor interest, with post-pandemic investments rising 467% to Rs. 41,822 crore (US$ 4.4 billion). Its development pipeline stands at 324 million square feet, of which 77% is expected to be Grade A stock. JLL expects infrastructure development, urbanization and economic growth, along with a more mature exit ecosystem supported by Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs), to support long-term institutional investment.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
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