Investment Opportunities Propel Tier-2 Cities onto the Radar of Infrastructure Development
Transforming Tier-2 Cities: Infrastructure Boost Turns Secondary Hubs into Prime Real Estate Investments
India's Tier-2 cities, long overshadowed by their metropolitan counterparts, are undergoing a significant transformation, reinventing themselves as major investment destinations. The catalyst for this transformation is the rapid development of infrastructure, which is playing a pivotal role in propelling these cities forward.
According to a CREDAI-Liases Foras research report, as many as 44% of the 3,294 acres of land acquired by real estate developers in 2024 were concentrated in the emerging hubs of India's Tier-2 and Tier-3 cities. This shift in focus is particularly evident in cities like Dehradun, Chandigarh, Mohali, and Lucknow.
Dehradun: A Serene haven with an Urban Heart
Previously known as a hill retreat, Dehradun is now attracting homebuyers and investors who seek tranquility amidst a growing economic ecosystem. The city is experiencing a wave of infrastructure development, with the Delhi-Dehradun Expressway being a significant milestone. Upon completion, the six-lane expressway will slash travel time between Delhi and Dehradun to just 2.5 hours, making the city more accessible and appealing. Additionally, the Dehradun Smart City Mission is modernizing urban infrastructure with improved roads, IT-enabled services, and sustainable public spaces. These developments have sparked a surge in demand for plotted developments, premium apartments, and vacation-style second homes.
Manit Sethi, Director of Excentia Infra, opined, "Dehradun's real estate market is undergoing a comprehensive revolution. With the Delhi-Dehradun expressway nearing completion and smart city initiatives gaining traction, the city is no longer just a weekend escape. We've seen a sharp rise in demand from NCR buyers who want better air, scenic views, and a future-ready address. The city's infrastructure momentum is paving the way for premium projects, offering lifestyle, connectivity, and appreciation potential all in one."
Lucknow: Emerging as a Hub of Infrastructure and Investment
Lucknow, with its compelling blend of tradition, modernity, and strong infrastructure growth, is seeing a remarkable expansion in its real estate market. Strategic infrastructure projects like the Purvanchal Expressway, Outer Ring Road, and the expanding metro network have drastically improved connectivity within the city and beyond. This surge in growth is notably evident in the city's real estate sector, with significant appreciation rates in both residential and commercial properties.
According to Yash Miglani, Managing Director of Migsun Group, "Lucknow is becoming an infrastructure-led investment magnet. We're seeing a dramatic shift in both scale and sentiment, driven by expressways, metro expansion, and strategic ring roads. As developers, we're responding to a market that demands more than just residential spaces, and we believe that thoughtfully designed commercial projects in Lucknow will redefine the city's business landscape in Northern India."
Chandigarh and Mohali: Emerging as a High-Potential Investment Belt
The Tricity region, comprising Chandigarh, Mohali, and other neighboring areas, is fast evolving into a vibrant investment zone, driven by a robust pipeline of infrastructure upgrades. The expansion of Chandigarh International Airport and improvements in key road networks like PR-5 and PR-7 have significantly boosted regional connectivity. This ongoing growth makes the region an increasingly attractive option for luxury real estate investors, with a focus on high-rise gated communities and Grade-A commercial spaces.
"We foresee Chandigarh becoming a nucleus of North India’s real estate momentum. With the airport expansion and key road infrastructure like PR-7, the region is seeing a strategic shift in buyer interest toward areas like New Chandigarh and Mohali. What we're witnessing is a wave of aspiring buyers looking for urban sophistication without Delhi-level chaos, and the upcoming metro will only accelerate this trend. Thus, Chandigarh’s planned growth, strong civic infrastructure, and rising connectivity make it a prime zone for both residential and commercial real estate investment," stated Piyush Kansal, Executive Director of Royale Estate Group.
Across India's Tier-2 cities, robust infrastructure development is driving growth in the real estate sector, transforming these secondary hubs into prime investment destinations. The combination of state-level policies, urban planning reforms, and private sector participation is reshaping the real estate landscape, making cities like Ayodhya, Rishikesh, and others increasingly competitive alternatives to traditional metropolitan centers.
This shift in investor sentiment is unmistakable, as these cities are becoming strategic investment destinations offering high returns, improved quality of life, and fast-improving infrastructure. As a result, cities like Dehradun, Lucknow, Chandigarh, and Mohali are witnessing a significant influx of investments, redefining the real estate growth narrative in India.
Employment opportunities may flourish as infrastructure development in Dehradun attracts businesses, pushing the city to be a potential hub for work and growth.
The upgraded sports infrastructure in Lucknow could stimulate local teams and attract professional sports events, creating a vibrant sports culture and further bolstering the city's attractiveness as an investment destination.
