Hillhouse Plans to Double India Investments, Puts Real Estate and Data Centres in Focus

Singapore-based investment firm Hillhouse Investments is planning to significantly increase its exposure to India over the next two to three years, with real estate and data centres emerging as key areas of focus.

The firm has already deployed more than $2 billion in India across real estate, private equity and credit, while its commitments in the country are approaching $4 billion in assets. Hillhouse now plans to double its India investments, signalling growing confidence in the country’s real estate and digital infrastructure markets.

Real estate is expected to remain an important part of the strategy. According to Joe Gagnon, Co-Head of Real Assets at Hillhouse Investments, India is already the firm’s largest real estate market in Asia. More than $1 billion of equity has been invested in the country, with around one-third of Hillhouse’s investments to date being in India.

The firm sees an opportunity in India’s relatively young institutional real estate market. While mature markets such as the US have large specialised companies operating in areas such as warehousing and data centres, India still has fewer scaled platforms in these segments.

Hillhouse believes this gap could create opportunities to build specialised businesses around long-term changes in technology, demographics and consumption. The firm has identified sectors including warehousing, data centres, education infrastructure, rental housing, senior care and second homes as areas with potential for further growth.

Its approach also differs from simply buying individual properties. Hillhouse says it identifies a long-term theme, partners with an operating team and provides capital to build a platform around that opportunity. The firm describes this as a model that combines real estate investment with elements of private equity and business building.

Data centres are expected to receive particular attention. Hillhouse and its Indian operating partner Alta Capital are planning a separate co-investment pool for the sector because the opportunity could require several billion dollars of investment.

The data centre opportunity is linked to the rapid growth of India’s digital economy. India generates around 20% of global data but currently accounts for only about 2% to 3% of global data centre capacity, according to estimates cited by the firms. India’s installed data centre capacity is estimated at around 1.5 to 2 GW, compared with roughly 35 to 50 GW in China.

This gap is attracting investors looking for long-term opportunities in digital infrastructure. Hillhouse plans to build a full-stack data centre platform in India and believes the market could eventually support several major players.

The firm’s strategy reflects a broader shift in Indian real estate, where investment is increasingly moving beyond traditional offices, residential projects and retail towards assets linked to technology, logistics and changing consumer needs.

For India’s infrastructure market, the development is significant because data centres require large amounts of land, power, connectivity and specialised construction. Increased institutional investment could therefore create demand not only for data centre buildings, but also for supporting infrastructure and related services.

Hillhouse’s planned expansion highlights the growing overlap between real estate, technology and infrastructure in India. As digital consumption continues to rise, data centres are becoming an increasingly important part of the country’s physical infrastructure landscape.