India has established itself as the leading market for real estate yields in the Asia Pacific region, according to a recent report from CBRE. The country recorded a remarkable 189 percent increase in investment volumes in the first quarter of 2026, reaching $2.29 billion. This surge is noteworthy, especially when compared to the previous year's figure of $839.85 million. While Singapore also experienced a significant rise in investment volumes with a 364 percent year-on-year increase, India stands out for its consistently higher yields across various asset classes. The report indicates that capitalization rates in India surpass those of its regional counterparts by as much as 320 basis points across sectors such as office, retail, logistics, hotels, and student housing.
Anshuman Magazine, Chairman & CEO for CBRE in India, South-East Asia, the Middle East, and Africa, emphasized that the growing demand for real estate is driven by robust economic fundamentals in India, a burgeoning corporate sector, and a youthful, consumption-oriented population. As global investors who had previously been hesitant begin to explore opportunities in the Indian market, the momentum is anticipated to strengthen further. The increasing availability of institutional-grade products is likely to attract more capital, as domestic institutions, family offices, and international players are gradually increasing their allocations to Indian real estate. This trend is evident in the growing interest in direct acquisitions, Real Estate Investment Trusts (REITs), and structured debt instruments, highlighting India's emergence as a top market for real estate debt interests in the Asia Pacific region.
The report further elaborates on specific asset classes, noting that Grade A office cap rates in India range from 7.50 percent to 8.40 percent in prime central business district locations. This is in stark contrast to the lower cap rates observed in Singapore (3.25 percent to 3.80 percent) and Tokyo (2 percent to 3 percent). India has positioned itself as one of the top three preferred markets for Grade A office investment inquiries in the Asia Pacific, alongside Singapore and Japan. Furthermore, the yields in student housing are particularly attractive, standing at 8.50 percent to 9 percent, which is approximately 320 basis points higher than Australia, the next highest market in this category. Similarly, institutional-grade logistics cap rates in India range from 7.15 percent to 7.75 percent, outpacing Vietnam, which records rates of 6 percent to 7 percent.
In conclusion, India's real estate market is gaining significant traction, characterized by strong yields and increasing investment inflows. As the economic landscape continues to evolve, the country is set to maintain its position as a standout player in the Asia Pacific real estate sector, attracting both domestic and international investors eager to capitalize on its potential.