Tax default properties—land parcels seized and auctioned by authorities due to unpaid property taxes—are increasingly becoming a strategic acquisition route for investors aiming to expand their industrial land portfolios. These assets, often located in underutilized or transitional industrial zones, are entering the market at discounted valuations, presenting high-upside opportunities for developers, private equity firms, and logistics park operators. With improving legal frameworks and auction transparency, these once-overlooked plots are now being viewed as viable, value-unlocking additions to industrial real estate holdings.
States such as Maharashtra, Gujarat, Tamil Nadu, and Telangana are leveraging tax recovery mechanisms to auction off dormant or encumbered industrial land, especially within areas experiencing infrastructure upgrades under PM Gati Shakti and state-level industrial corridor programs. Investors are strategically acquiring such properties near freight hubs, arterial highways, and emerging warehousing clusters, with the intent to repurpose them into build-to-suit manufacturing units, logistics facilities, or SME-focused industrial parks. The reduced entry cost of these parcels provides flexibility in capital structuring and increases the potential for higher yield and ROI post-development.
What enhances the appeal of tax default acquisitions is the growing legal clarity, digitization of land records, and government efforts to clear encumbrances before sale, which reduces risk and accelerates project timelines. As institutional demand for scalable industrial land continues to rise, especially in the context of supply chain localization and e-commerce-driven expansion, tax default properties are becoming a cornerstone of opportunistic yet structured portfolio growth in India’s industrial real estate landscape.
