Indian Real Estate Sees 32% Year-on-Year Surge in Land Acquisitions
The Indian real estate industry witnessed a significant surge in land acquisitions in 2025, with developers acquiring 3,093 acres across 149 transactions valued at Rs 54,818 crore, according to a recent report by JLL.
Key Findings:
- 32% Year-on-Year Surge: Land acquisitions in India have seen a 32% year-on-year surge in 2025.
- Development Potential: The acquired land is expected to unlock nearly 229 million square feet of development over the next two to five years.
- Tier I Cities Dominance: Tier I cities accounted for 89% of total capital deployed despite representing only 52% of land acquired.
- Tier II Cities Opportunity: Tier II cities accounted for 48% of land transactions but attracted just 11% of investments, indicating lower land costs and emerging growth opportunities.
Q1 2026 Momentum:
The momentum has continued into 2026, with around 900 acres acquired in Q1 across key markets, valued at nearly Rs 18,000 crore.
Largest Deal in Mumbai Metropolitan Region:
The report also stated that the Mumbai Metropolitan Region recorded the largest deal, with an 11-acre parcel transacted for Rs 5,400 crore.
Construction Capital Requirements:
Developing these land parcels will require over Rs 92,000 crore in construction capital, with external funding needs estimated to exceed Rs 52,000 crore.
Increased Participation from Alternative Investors:
The report noted that this would likely drive increased participation from Alternative Investment Funds (AIFs), private credit providers, and institutional investors.
Tier I Cities to Absorb Majority of Capital:
Tier I cities are expected to absorb nearly 89% of the capital required for upcoming developments due to higher project costs and premium real estate demand in major metros.
Residential Development Remains Primary Growth Driver:
Residential development has remained the primary growth driver, accounting for 78% of land allocation and around 76% of total funding requirements, with an estimated construction cost exceeding Rs 72,000 crore.
Office Development and Emerging Asset Segments:
While office development has a projected capital requirement of about Rs 8,700 crore, suggesting continued demand for Grade A office spaces, developers are increasingly exploring opportunities in data centres, logistics parks, and other alternative real estate classes.
Supply Side Dominance by Individual Landowners:
The report also noted that individual landowners dominated the supply side, accounting for 65% of total transactions.
City-wise Breakdown:
- Chennai, Mumbai, Bengaluru, and Pune: Individual sellers were dominant in these cities.
- Hyderabad: Corporate entities led in this city.
- Delhi-NCR: Government bodies accounted for a majority of transactions.