Indian Property Market

The Indian real estate sector is witnessing burgeoning growth over the past couple of decades and also one of the fastest growing sectors in the country that in turn lure investors worldwide to invest in India’s growing real estate markets like Chennai, Bangalore, Hyderabad, Gurgaon Mumbai etc. This augment in growth is due to several factors like rising income levels among growing middle class, nuclearization of families, easy home loans and changing demographics of home buyers (the average age of a new homeowner in 2006 was 32 years compared with 45 years a decade ago.

A growing Indian economy has created huge demand for commercial property spaces in the country to meet the office space needs for a leading corporate, MNCs, IT/ITES sector and organized retail. The Indian organized retail itself is likely to acquire 220 million sq.ft. by 2010 across pan-India not limited to only top cities alone.

With a rising demand in the Indian realty, there are a large number of international real estate players have entered the real estate segment in the country. The demand for office space is growing at a CAGR of 13% on a pan-India basis.
Office Space Demand Projection

Key regulatory developments
The key regulatory developments in the country are listed below that enlightens the growth momentum in the Indian real estate market:

•Foreign investors are allowed to invest in commercial real estate developments across the country with a minimum built up area of 50,000 million sq.ft and Minimum area threshold for FDI in Integrated Townships reduced to 25 Acres from 100 Acres.

•Securities & Exchange Board of India (SEBI) has allowed Indian venture capital firms to invest in real estate.

•Under Automatic route, 100% Foreign Direct Investment (FDI) is allowed in the construction sector.
Global Investors

Today, the leading global investors are exploring the untapped opportunities in India’s real estate market with an investment worth of US$20 billion by 2010. Some of the big players like JP Morgan, Merrill Lynch, Lehman Brothers, GE Capital, HSBC, Government of Singapore Investment Corporation and host of others. The following are a few highlights in the real estate investments in the country:

•One of the world’s leading global real estate firm, Jones Lang LaSalle (JLL) plans to invest around US$ 1 billion in India’s property market.

•Dawnay Day International plans to setup a chain of four-start hotels in India with investment worth of US$ 4 billion.

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