This Overlooked Real Estate Asset Is Giving Better Returns Than FDs—How Investors Are Making Big Money Now?

For years, the centre of gravity in Indian real estate was around housing, offices, and retail. Those categories still attract capital, but investors scanning the market today are looking at a wider canvas. Options like data centres, warehousing, and REITs have grown into serious alternatives because they carry stronger visibility, clearer demand drivers, and a closer link to how India's economy is changing.

Data Centres and Warehousing: The New Demand Story

India's digital consumption curve has reshaped the real estate ecosystem faster than anyone expected. With AI adoption rising, cloud usage accelerating, and high-speed connectivity reaching new markets, the country's data needs have surged. Developers in Mumbai, Navi Mumbai, Hyderabad, Pune, and Chennai are expanding capacity to match this demand. From around 1.2 GW today, India is projected to cross 3.5 GW of capacity by 2030.

For investors, this category stands out because it combines strong tenancy with predictable income. As Ms. Binitha Dalal, Founder & Managing Partner, Mt. K Kapital, explains, "Data centres have become the most important real-estate asset class in the country today. They are the critical digital infrastructure, and their long-term demand is unquestionable. More importantly, they carry the potential to form the next wave of REIT portfolios. Investors are seeing that this category offers better visibility, stronger occupier quality, and steadier returns than most traditional assets. When you compare that with instruments like fixed deposits, the appeal becomes clearer where you get higher yields along with the comfort of owning a hard asset at the end of the day."

Warehousing has climbed the priority list for similar reasons. E-commerce created large-scale demand, but the next push is coming from manufacturing, third-party logistics, and India's growing role in global supply chains. Companies want Grade-A facilities near highways, ports, and airports, driving developers to build larger, more organised parks. The result is a segment that feels steadier and more predictable for long-term capital.

REITs & SMREITs: A Broader Path for Investors

India's listed REITs opened the door for everyday investors to access commercial real estate without owning an entire asset. The arrival of SMREITs has taken that idea further by allowing income-generating assets between Rs 50 crore and Rs 500 crore to be brought into structured portfolios.

Awareness is still building, and the category is early in its journey, but the opportunity pool is substantial. As developers and investors look for transparent, organised ways to participate in newer asset classes, SMREITs are well positioned to fill a gap.

Awareness is still developing, but the underlying opportunity is substantial. As Ms. Dalal adds, "Alternate investments are becoming the new stock market for a lot of investors.

What matters is the structure. Blind-pool investments leave too many questions unanswered, but defined pools offer clear visibility, where you know the asset, you understand the income profile, and the exit pathway is far more crystallised. Coupled with the rising popularity of REITs, these platforms give investors a simple way to replace low-yielding fixed deposits with an instrument that delivers steady returns and long-term growth from a tangible asset."

A clear shift is underway. Instead of relying only on traditional asset types, investors are gravitating toward categories that mirror India's broader economic themes of digital expansion, consumption, logistics, and manufacturing. Data centres offer resilience, warehousing offers scale, and REITs offer access.

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