Global capital turns selective, India stays on the investment map: Hines' Steinbach

As global markets adjust to structural shifts and economic uncertainty, India is increasingly viewed as a destination for long-term real estate investment. David Steinbach, Global Chief Investment Officer at Hines, discusses how demographic trends, policy reforms, and evolving market fundamentals are shaping India’s real estate landscape. Excerpts edited.


Q1. What makes India a strategic focus for Hines in today’s global investment climate?
Steinbach: Despite the broade macroeconomic uncertainty, we continue to view private real estate as a high-conviction investment given its tangible nature and historical resilience amid higher-for-longer environments, and India is no exception. In our view, India presents a combination of scale, relative stability, and domestic demand that stands out in today’s de-globalizing environment.

We’re seeing the global economy undergo structural shifts, such as supply chain reconfiguration and capital bifurcation, that are influencing how and where capital is deployed, which we believe could provide tailwinds for India. One outcome of these shifts could be capital staying closer to home, meaning investors in Asia may be more keen to invest within the region. That, paired with the fact that intra-regional trade in Asia is extremely mature, could bode well for India in the long-term.

In this context, India’s rising consumption and urbanization, supported by policy reforms, has offered a foundation for long-term real estate investment that appeals to many investors. Since launching our India platform in 2006, we’ve seen that local execution and strong partnerships have been essential to succeed. As global capital becomes more selective, India presents a market where fundamentals should support long-term deployment strategies.

Q2. How does India’s private real estate market compare to global trends?
Steinbach: India’s private real estate market has demonstrated resilience across various property types, including living, office, industrial, and retail sectors. While construction activity has slowed in many global markets due to cost pressures and uncertainty, India has continued to show demand across all asset classes so far, especially office.

Office rental yields in major cities have remained competitive, and the office sector has seen steady absorption. Our research indicates that India just saw a record second quarter for total leasing in the office sector, as tech and manufacturing firms continue to expand their footprint there or upgrade to newer, cutting-edge space. These trends suggest that performance has been driven more by fundamentals than sentiment.

Q3. What sectors are Hines most focused on in India right now?
Steinbach: We’re focused on sectors and geographies where fundamentals are strong and long-term demand is evident. The office sector in India has been an outlier with both domestic and international companies, as well as global capability centers and innovation hubs, contributing to sustained demand for high-quality space. Living also presents a significant opportunity given a lack of institutional quality properties and a growing need for more housing, especially in dense urban areas.

Industrial assets have gained traction, supported by goods and services tax reforms, e-commerce, and manufacturing initiatives like ‘Make in India.’ Our approach is to concentrate on sectors requiring operational complexity, where we have proven success and as we aim to drive income and long-term value creation.

Q4. How do interest rates and inflation affect your strategy in India?
Steinbach: Real estate is sensitive to interest rates, and globally we’re operating in a higher-for-longer environment, which emphasizes the cash-flowing benefits of real estate. In India, the dynamics are somewhat different, as rates were recently cut by 100 basis points but now look to remain steady. While inflation and construction costs are ongoing challenges, domestic demand and urban expansion continue to support development opportunities.

Our current focus in India has been on building high-quality commercial and residential assets that meet the evolving needs of cities. With deep local partnerships and decades of experience in the region, we take a disciplined approach to identifying opportunities that align with long-term urban and economic trends. Our strategy reflects our financial strength and commitment to delivering performance through execution.

Q5. What advice would you give to Indian business leaders and investors looking at real estate today?
Steinbach: A fundamentals-based, long-term approach remains important. Sectors like housing, office, and logistics are expected to remain relevant, but success depends on understanding local market dynamics and executing with discipline. India will likely benefit from shifts in global capital allocation, and realizing value requires alignment with policy trends and collaboration with experienced operators. In today’s environment, where capital is increasingly discerning, operational excellence and deep local insight are now imperative for success.

India’s real estate sector is increasingly part of the global conversation. As Hines continues to engage with high-conviction sectors and deepen its presence, India’s position in shaping the future of real assets is becoming clearer.