India’s Rich Pivot Real: Investors Seek Property Funds as Stocks Lag
Indian wealth managers are raising money for real estate and infrastructure funds as wealthy investors seek income-generating assets after two years of modest stock returns. At least six new vehicles launched this year are seeking more than $1.25 billion, while the Nifty 50 delivered lower returns than the S&P 500 over the period.
Indian wealth managers are raising funds for real estate and infrastructure as wealthy investors seek alternatives after two years of subdued stock returns, a shift that contrasts with the global rush into equities tied to artificial intelligence. At least six new investment vehicles launched this year are seeking more than $1.25 billion for property and infrastructure assets.
The Nifty 50 delivered total returns of 7% over the past two years, compared with 29% for the S&P 500, despite a rally in recent weeks.
Nuvama Wealth Management, backed by PAG and overseeing $39 billion in client assets, raised around $420 million for a commercial real estate fund with Cushman & Wakefield Management. Chief Executive Officer Ashish Kehair said the firm plans more funds focused on income-generating properties or infrastructure, typically with a later sale or listing.
“There is a shift toward private credit and cash-flow generating assets,” Kehair said. He said the category also includes real estate investment trusts, logistics and warehousing.
India’s Alternative Investment Funds raised $64.5 billion from local investors between March 2024 and June 2026, nearly double the previous amount. Private credit is drawing the most interest, while family offices and asset managers are also turning to infrastructure, energy and property funds.
Unlisted funds that invest in completed assets are attracting attention because investors may gain additional upside if those assets are sold or listed in vehicles such as real estate investment trusts. Local real-asset funds may target annual returns of 12% to 15%, compared with yields below 8% on three- to five-year AAA-rated corporate bonds. Actual returns depend on factors including the assets, leverage and exit valuations.
Rohit Sarin, co-founder of Client Associates, which manages more than $6 billion in advisory assets for over 1,400 wealthy clients, said the range of investment options has grown. “Earlier, there were a limited number of REITs and infrastructure investments available to build a meaningful portfolio,” he said, adding that new funds offer pre-listing products.
Many Indian family offices now allocate between 40% and 45% of their portfolios to alternatives, including private credit, venture capital, real estate investment trusts and Infrastructure Investment Trusts, according to an August report by Julius Baer and EY India. Those portfolios were traditionally anchored in listed equities, fixed deposits, real estate and gold.
Karan Shah, head of fixed income and real assets at Neo Wealth, said such funds were historically reserved for institutional investors because of their high risk, large investment sizes and long investment cycles. Family offices and wealthy investors now participate in large transactions through specialized funds, particularly when sponsors or asset owners seek to provide an exit to existing investors.
