India A Big Mart For The Real Estate Industry

By Author: Mayur Dicosta
Total Articles: 12
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India's real estate bellwether, DLF was currently under tremendous financial pressure, in the wake of the ongoing economic slowdown. However, as the saying goes, when the going gets tough the tough gets going, the company sold of its non-core assets to keep the company from sinking. If we keep these recent developments aside, India's real estate sector seems to be forward-looking and buoyant. Thanks to India's attractive demographic and economic scenario. According to the survey carried out by the Federation of Indian Chambers of Commerce and Industry (FICCI) and Ernst & Young, India is poised to become one of the biggest marts for global realty and investment firms.

Major Real estate Growth Drivers that help promote India's big mart status include,

* The rise of India's middle class, which has led to increase in demand for houses.

* India has second largest population in the world and the growth rate is still accelerating.

* Increase in FDI levels has led to commercial space requirements by foreign firms.

* Rise of retail sector.

* Easy ...
... flow of money.

Retail Real Estate: The Indian industry of Retail is a story of soaring successes. Wal-Mart, the American retail giant's foray in to the Indian Territory, is a testimony to India's rapidly growing graph in the retail sector. Retail chains, shopping centers and hyper markets are mushrooming like never before. Also, since 2006, Indian Government has facilitated foreign direct investment in retailing with 51 percent participation. The retailing sector is estimated to reach US$ 23 billion by 2010. The boom in the retail sector has been pushing forward India's retail real estate industry.

Housing Real Estate Demand: The country's unstoppable population growth, rising income levels, growing number of nuclear families, tax incentives, easy availability of home loans are leading the growing demand for houses and therefore increase in residential construction. The current shortage of houses stands at around 20 million units and the demand is expected to rise in the forthcoming years. So, investment in the housing real estate sector seems to be an interesting business proposition. India's Tata Group has already geared up operations in this direction. The group plans to set up 15000 low-cost housing in the range of Rs. 3,90,000 and Rs. 6,70,000.

Structure: Real Estate Sector in India is still at its nascent stages. There exist only a few organized players in the market. Most of the real estate developers have limited presence. The top real estate companies in the country include, DLF, Ansal group, Hiranandani and Unitech.

Real Estate Investment Opportunities in India

Office/ Industrial Complexes

Residential complexs

Commercial Space for Organized Retailing

Hotels and Hospitality Sector

Special Economic Zones

Venture Funds

Major Projects Cleared by Foreign Investment Promotion Board

* Buoyed by the realty boom in India, Dubai-based Emaar group plans to invest USD 500.0 million

* CESMA International Pvt Ltd, a subsidiary of the Singapore government's housing agency is planning to set up township project at Hyderabad and Vijaywada along with the help of Andhra Pradesh

* Jakarta based Salim group plans to invest USD 100.0 million project at Kolkata

* Lee Kim Tah Holdings, Singapore based company intends to invest USD 115.0 million project at Chennai.

* IJM's USD 350.0 Mn project at Mohali, Chandigarh

* Keppel Land, Singapore's USD 13.0 million land acquisition at Bangalore for condominium project in JV with Puravankara.