While Bengaluru leads in REIT penetration among major office markets, Hyderabad is emerging as the second most institutionalised commercial real estate markets, with REIT-backed assets accounting for 20% of its operational office stock, a report has said.
India’s operational office REIT portfolio expanded 74% year-on-year (YoY) to 167 million sq ft in H1 2026, from 95.8 million sq ft in H1 2025, according to the ASSOCHAM-Knight Frank India report Building Viksit Bharat – Real Estate as a Catalyst for Growth.
Hyderabad has 129.1 million sq ft of operational office stock, of which 26.2 million sq ft is REIT-backed, almost 20%. The city’s REIT-backed office stock more than doubled, rising 111% from 12.4 million sq ft in June 2025 to 26.2 million sq ft in June 2026, pointing to a sharp increase in institutional ownership, the report noted.
Bengaluru has the highest REIT penetration among major office markets, with 67.6 million sq ft of REIT-backed stock accounting for 27% of its 254 million sq ft office inventory. Mumbai Metropolitan Region (MMR) ranks third, with 24.6 million sq ft of REIT-backed assets accounting for 14% of its 173.8 million sq ft office stock, it showed.
Office space remains the dominant segment of India’s REIT market. Operational office REIT assets account for 16% of the country’s 1.05 billion sq ft office stock, with another 36 million sq ft under construction.
Hyderabad's REIT-backed office assets gaining ground
{{/usCountry}}Office space remains the dominant segment of India’s REIT market. Operational office REIT assets account for 16% of the country’s 1.05 billion sq ft office stock, with another 36 million sq ft under construction.
Hyderabad's REIT-backed office assets gaining ground
{{/usCountry}}Hyderabad’s growing institutionalisation is supported by its established office clusters and occupier base, particularly in locations such as HITEC City. The city also had 0.8 million sq ft of operational retail REIT assets as of June 2026, indicating growing institutional participation across asset classes, the report noted.
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“The sharp expansion in Hyderabad's office REIT stock reflects the increasing depth of institutional capital in the city's commercial real estate market,” said Joseph Thilak, Executive Director – Occupier Strategy & Solutions, Head of Data Center Business (India) Hyderabad, Knight Frank India.
“Hyderabad's ability to attract and accommodate large-scale institutional portfolios is supported by its established office clusters and occupier base. As institutional participation broadens, we expect the city to remain an important market for the next phase of India's REIT-led office growth,” he said.
The broader real estate market is also shifting from volume-led growth towards value creation, institutional capital and specialised asset ecosystems, the report noted.
Residential gross sales value more than doubled from ₹3,525 billion in 2021 to ₹7,343 billion in 2025, while office transactions grew at a 7% CAGR between 2015 and 2025, outpacing completions across eight major Indian markets. Real estate attracted $59.8 billion in cumulative private equity investment between 2015 and H1 2026, with the office sector accounting for 46%, the report noted.
Institutionalisation is also expanding into newer asset classes. Warehousing InvITs now hold around 32.2 million sq ft of operational assets, with another 12 million sq ft under construction or in the pipeline.
At the city level, specialisation is becoming increasingly important, with Hyderabad strengthening its position in GCCs and data centres alongside its established office market, it added.