It is now a common concern among policymakers that the real estate and urban infrastructure developments are happening around big cities. And a large share of the development’s investments coming into the country are being pulled to these centres. A recent JLL study, Institutional Flow of Funds to Indian Real Estate corroborates the trend. It says, top metros, including Delhi, Mumbai and Bengaluru, continued to be the favourite destination of investors in the last 10 years.These cities collectively scooped 74 per cent of the entire real estate investments during this period. Among the three, Mumbai leads the pack with $11.8 billion investments. Sonit Singh, COO and Head, Cross Border Capital Markets, JLL India, highlights a few trends: Large commercial offices continue to be the favourites among investors whilst residential sectors have seen a gradual decline of institutional investments.Investors have been keen to and still willing to put their money into projects from branded and reputed residential real estate developers.All three megacities have become high job growth centres for a large young cosmopolitan population.In the past decade, all these cities have been exponentially investing in their infrastructure. To understand the trend clearly, it is important to know recent history, when the world markets were down due to the global financial crisis. The slow recovery of markets, especially in the residential segment resulted in a brief lull in investments in the segment. This led investors to invest in income yielding office space assets as a stable source of returns. With steady growth, commercial then emerged as the safest bet. With improving policy standards, market transparency, the announcement of REITs and subsequent simplification of REITs regulation, the business environment is conducive for further growth and investments. It is no surprise while Bengaluru has flourished due to strong growth in IT and ITeS segment, Delhi-NCR and Mumbai had a maximum concentration of ready commercial assets.  This trend got further stronger during the 2014-18 period wherein $20.3 billion has been invested in the real estate sector. Of this, $8.4 billion had been invested in commercial office space.  What does it mean for investors?Although metro is still at a developing stage, it has all the necessary growth elements required for large as well as small funds looking at the two segments, namely residential and commercial. Real Estate Regulatory Authority Bill 2016 (RERA), a real estate regulation, enacted in 2016, has made the market more compliant and transparent which is likely to see consolidation in the space, and thereafter improved investments.  Further, project level investments from funds keen to buy stressed assets, which are seen as value investments, is witnessed. Each of these megacities has its own merits for being on investors’ radar. While both Mumbai and Delhi have satellite towns and cities as growth centres that have been grown commercially, Bengaluru has gradually attained the name for being the startup centre and the Silicon Valley of India. These developments have made these cities and the variety of projects across residential, commercial and infrastructure viable for further investments. These will continue to be the seat of investments in the coming decade too. What lies ahead of us?While there are investment opportunities across these cities, there are several challenges to be addressed. Across all these three cities, the residential segment has lagged in comparison to the other asset classes, especially commercial. High inventory due to high asset prices, project delays due to financial constraints and other reasons, have resulted in rise of property values. And the direct outcome has been a dip in residential sales. Further, due to GST being imposed post its implementation on under construction dwellings as compared to completed ones has impacted the sales of under construction inventory adversely. The lowering of GST comes as a relief though. It will aid in expediting the liquidation of under construction stock. The same trend can also be attributed to delays and a general lack of confidence among developers. To address the challenge, there is also a need to align the market to the real demand, which is affordable housing. This being a possibility, can be supported with taking the investments to other cities other than tie one markets of Delhi, Mumbai and Bengaluru. Cities like Pune, Chennai, Hyderabad and Kolkata are fast catching up in terms of infrastructure and commercial office space growth in these cities. State capitals now promise stupendous growth for investors. These cities along with the top three markets would provide huge opportunities for investments in various assets classes of real estate. Applying the blueprint of success to other cities, holds the key to further growth. While investors are scouting for opportunities in other parts of the country, the industry needs to take up the game and work in sync with the real demand. The country is still developing and will continue to do so in the next decade. All needed is steer the investments in the right direction for a comprehensive growth.