Small Cap real estate companies have been the best performing segment in the past 12 months, garnering 17% returns, followed by REITs at 15.2%, midcap at 2.5%, the benchmark index Sensex posted a meagre 1.4%, whereas the largecap real estate listed companies posted a negative -2.9% returns.
Over 43% of capital raised by REITs since FY18 in the sector Since FY18 a total of Rs 723,310 mn was raised in the real estate sector, out of that REITs accounted for over 43% around Rs 312,413 mn, followed by Rs 204,370 mn.
India’s real estate sector saw a Rs26,000 crore capital inflow over the past year, with REITs, smallcap stocks, and warehousing emerging as clear growth leaders.
According to Financial services firm Equirus Securities, small cap real estate companies delivered a 17% return in the past 12 months — outperforming all other segments. REITs followed with 15.2% returns all other segments. REITs followed with 15.2% returns, while midcaps gained, while midcaps gained 2.5%. In contrast, the benchmark Sensex posted a modest 1.4%, and large 2.5%. In contrast, the benchmark Sensex posted a modest 1.4%, and largecap listed real estatecap listed real estate players saw a decline players saw a decline of -2.9%.
Over a longer time horizon a longer time horizon, small caps continue, small caps continue to lead performance to lead performance since March 202 since March 2021, followed by mid1, followed by midcaps, largecaps, Sensex, and REITs in descending order of returns.
The report also points in India’s warehousing sector. Total to rapid expansion in India’s warehousing sector. Total stock across the top 8 Tier 1 cities has more than doubled since 2019 — from 213 million sq. ft to 438 million stock across the top 8 Tier 1 cities has more than doubled since 2019 — from 213 million sq. ft to 438 million sq. ft as of 2024. Nationwide, warehousing stock reached sq. ft as of 2024. Nationwide, warehousing stock reached ~533 million sq ~533 million sq. ft, up from ~300 million sq. ft in 2019.
India’s Warehousing sector has been expanding horizons with emerging opportunities beyond the metros. The growth in the warehousing stock is fueled by infrastructure upgrades, policy reforms, and consumption surge in Tier 2 & 3 cities. The total stock reached ~533 Mn sq.ft in CY 2024, from ~300 Mn sq.ft in CY 2019.
Government schemes like GST, Gati Shakti, DFCs, and UIDF are boosting warehousing expansion and connectivity. The growth is largely driven by of e-commerce demand (nearly 60%) coming from smaller cities, warehousing demand is rapidly expanding beyond Tier 1 hubs.
Tier 2–3 cities contribute ~95 Mn sq.ft (18%) of total stock — a 4X increase since 2017. Grade A share in new absorption is ~80% in 2024 across top 8 Tier 1 cities. In emerging cities, Grade A constitutes ~30% of stock, reflecting occupier shift toward quality.
Grade A infrastructure accounts for ~80% of new absorption accounts for ~80% of new absorption in Tier 1 cities in Tier 1 cities and ~30% in emerging and ~30% in emerging cities, reflecting occupier demand for quality logistics cities, reflecting occupier demand for quality logistics and industrial spaces and industrial spaces.
