A new wave of tax lien investment funds is sweeping across India’s real estate landscape, with a sharp focus on acquiring undervalued industrial plots through municipal and statutory auctions. These funds—often backed by high-net-worth individuals, private equity, or real estate investment platforms—are capitalizing on the rising number of tax-defaulted properties being brought to market due to stricter enforcement of property tax collections and recovery mechanisms. The growing digitization and legal streamlining of these auctions have made industrial land linked to tax liens a more accessible and attractive asset class.
Target regions include Maharashtra, Gujarat, Tamil Nadu, and Telangana, where industrial development authorities are increasingly using public auctions to liquidate lands from non-performing owners. These plots, often located in aging industrial estates or emerging logistics belts, are being acquired by tax lien funds at significant discounts to market value, then repositioned for long-term lease or redevelopment into build-to-suit assets, SME parks, or storage hubs. The appeal lies in both the arbitrage opportunity and the potential for value addition as infrastructure and policy support reach these zones.
Tax lien funds are leveraging India’s improving regulatory ecosystem—including digital land records, pre-auction legal verifications, and insolvency-linked asset resolution reforms—to mitigate risks traditionally associated with distressed land deals. As industrial demand rises and competition for primary land assets intensifies, these funds are poised to play a pivotal role in unlocking dormant land value, offering investors strong upside while contributing to the revitalization of underutilized industrial zones across the country.
