India’s industrial real estate market is witnessing a surge in institutional capital inflows, driven by the growing popularity of long-term lease models on industrial land. These leases—often structured for 30 to 99 years—offer investors a compelling proposition: stable, inflation-linked rental income, reduced operational risk, and strong asset security without the complexities of land ownership. This model is especially appealing in the context of rising demand for logistics hubs, manufacturing bases, and build-to-suit (BTS) facilities across high-growth corridors.
Institutional investors, including REITs, sovereign wealth funds, pension funds, and private equity firms, are actively targeting long-term leased land assets in strategically located industrial clusters. Locations such as the Delhi-Mumbai Industrial Corridor (DMIC), Chennai-Bengaluru corridor, and Gujarat’s Dholera SIR are emerging as key investment destinations due to their infrastructure readiness, policy support, and connectivity to freight and port networks. These long-tenure leasehold models allow investors to minimize upfront land acquisition costs while enjoying consistent returns, making them ideal for long-duration investment strategies.
Additionally, long-term leases de-risk asset development for occupiers, as they gain operational continuity without the capital burden of outright land purchases. This alignment of occupier needs with investor goals is reinforcing the ground lease model’s attractiveness. Supported by government-led industrial policies and land monetization programs, long-term leases are rapidly becoming the preferred format for institutional-grade industrial real estate investment, fostering capital efficiency, scalability, and sustained growth across India’s evolving industrial landscape.
