Opportunities from rapid urbanization
The rapid urbanization is expected to offer significant opportunities for real estate and infrastructure development in Indian cities, accrding to a report released on 5 Sept 2018 in Mumbai.
This sector has witnessed high growth in recent times with the rise in demand for office as well as residential spaces, said the report ‘Future of India Real Estate: Deciphering the Mid-term Perspective’.
Released by the Federation of Indian Chambers of Commerce and Industry (FICCI) and JLL, the report noted that the real estate developers have been instrumental in changing the face of India through building state-of-the-art infrastructure, buildings, townships, shopping malls spread all over the country.
Sanjay Dutt, Chairman FICCI Real Estate Committee, said: “The sector has been through a bumpy ride in the last couple of years, but the environment is changing and the sector is back in the spotlight with key indicators pointing at the revival of Indian real estate.
“Key regulatory reforms such as RERA and REITs have given a new lease to the sector, and investors and end users are regaining confidence towards the recovery trends in the industry. Logistics & warehousing, commercial & retail are witnessing surge in demand and absorption.
“Overall trends are moving in the right direction for the Indian real estate sector,” assured Dutt.
Ramesh Nair, CEO & Country Head, JLL India, added: “India’s real estate sector is at an inflection point and the evolutionary trends in the sector are paving the way towards sustainable growth of the industry.
“H1 2018 has seen phenomenal growth in Grade A office space from both, the demand and supply side. Private Equity interest in Indian retail realty is at an all-time high with the sector witnessing an investment of INR 950 cr in 2018.
“With regulatory reforms such as RERA and GST showing results, the sector is poised to grow exponentially. Student Housing, a new emerging sector presents a tremendous opportunity for the market,” he stressed.
The extent to which the real estate sector has grown can be gauged from investments in ‘under construction’ projects within investment grade real estate. This number which was about US$173.9 billion in Q4 2012, has touched US$242.6 billion in Q2 2018.
The report analyses the drivers and challenges facing the sector in the next 2 to 3 years.
Overall, strong economic fundamentals, proactive reforms and the use of technology will continue to boost the sector, said the report.
Apart from the conventional sectors, the emergence of alternative segmet (student housing and senior living) and greater demand from sophisticated logistics in the warehousing space are expected to be the drivers for robust growth and a promising future for the sector, it said. fiinews.com