At least six new vehicles launched this year are seeking to raise more than $1.25 billion for real estate and infrastructure assets, marking a resurgence after previously growing slowly. The trend contrasts with well-heeled investors across much of the world who have piled into stocks that gain exposure from the AI boom.

PAG-backed Nuvama Wealth Management Ltd., which oversees $39 billion in client assets, is one of the local companies leaning in. The Mumbai-based firm raised around $420 million for a commercial real estate fund in partnership with property consultancy Cushman & Wakefield Management and plans to launch more funds that invest in income-generating properties or infrastructure, typically with an eventual sale or listing, Ashish Kehair, chief executive officer, said.

“There is a shift toward private credit and cash-flow generating assets,” Kehair said, adding that these also include real estate investment trusts and investments in logistics and warehousing.

The move reflects a search for steadier returns after Indian equities lost momentum following years of gains. Despite a rally in recent weeks, the benchmark Nifty 50 index has given total returns of just 7% over the past two years versus 29% in the S&P 500 index.

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Money raised by Alternative Investment Funds in India from local investors nearly doubled to $64.5 billion from March 2024 to June 2026. While private credit is drawing the most interest, family offices and asset managers are increasingly turning to funds that invest in infrastructure, energy and property.

Unlisted funds, which typically invest in completed assets, are of particular interest for investors because they offer an additional upside if the assets are sold or listed in vehicles such as a real estate investment trust.Local real asset funds may target annual returns of 12% to 15% compared with yields of under 8% on three- to five-year AAA-rated corporate bonds. Actual returns vary depending on many factors including the underlying assets, leverage and exit valuations.

Globally, family offices are directing more capital toward public equities, while maintaining significant exposure to private markets, according to Citi’s global family office report, highlighting a contrast with the growing push into alternatives among India’s wealthy.

Shifting portfolios

Many Indian family offices now allocate between 40% to 45% of their portfolios to alternatives, including private credit, venture capital, REITs and Infrastructure Investment Trusts, according to an August report by Julius Baer and EY India. Traditionally, they were anchored in listed equities, fixed deposits, real estate and gold, it said.

Karan Shah, head of fixed income and real assets at Neo Wealth, a Mumbai-based firm with $15.4 billion of assets under advisory and management, said that historically, such real-asset funds were reserved for institutional investors, including pension managers, global private equity and real estate funds because of their high-risk, large ticket sizes and long investment cycles.

Today, family offices and wealthy investors participate in big transactions through large, specialized fund vehicles, particularly where a fund sponsor or asset owner is looking to provide an exit to existing investors or raise primary capital, he said.

In July, Neo Wealth raised around 10.4 billion rupees ($110 million) for its Real Asset Yield Fund which will invest in listed and privately held infrastructure investment trusts and REITs. It has also raised more than $500 million across two tranches of its Neo Infra Income Opportunities Fund.

EAAA India Alternatives Ltd., the country’s largest listed alternative asset manager, listed in Mumbai earlier this month. It oversees nearly $5.2 billion of fee-paying assets spanning real estate, infrastructure and private credit as of June. The firm’s real-assets funds manage nearly $3 billion, including 10 active funds, among them two infrastructure investment trusts.