Real Estate in India - Building Our Future

Huge Untapped Potential : Foreign Investment Acting as Fuel for Growth

The Indian real estate market size is expected to touch $180 billion by 2020 As per recent Indian Real Estate research, the average growth rate returns is 30%, which tells the tale of this booming industry An estimated shortage of 26.53 million houses during the Eleventh Five Year Plan (200712) provides a big investment opportunity. The commercial real estate yield in India is larger than any other country, thus making it one of the most popular destinations for real estate investment. Real estate experts predict that the realty sector will witness $90 billion worth investment by 2015. The collective investment for real estate and construction sector was to the tune of Rs. 1,252.79 crore.

Source - ASSOCHAM

What's happening in this sector currently ??

Private equity fund IL&FS Investment Managers (IIML) is estimated to have invested US$ 300 million in real estate and urban infrastructure projects in 2010

Tata Housing is planning to launch about 10 new residential projects in both affordable and luxury segments in 2010-11, with an investment of about US$ 268.9 million along with its partners

Realty major Ansal Properties & Infrastructure Ltd plans to invest about US$ 330.8 million for expansion of its existing integrated townships and to develop a group housing project in Haryana.

70 percent of foreign investors in India are making profits and another 12 percent are breaking even. Mauritius Based IREO Investment Holding has invested US$ 71 million in housing projects in India.

Thai real estate developer Pruksa Global plans to invest US$ 218 million in projects in India and launched its first residential project in the country at Bangalore in October 2010. Source - IBEF

What s driving growth in this sector ?

Economic Growth of the Country Rising Population Levels

High Returns on Investment

Identifying Sector Strengths and Weakness s

Strengths
Attracting High FDI flow High Demand due to Urbanization Rising Middle Class Numbers

Weakness
High Govt. Regulation High Taxes on Raw Materials Availability of Finance

Opportunities
Affordable Homes Segment Rural India Housing

Threats
Competition Economic Inflation

Finding Key Opportunities in the Real Estate Sector

Affordable Housing
A key growth driver in the real estate sector Does it take the shape of a key opportunity ?

How would we define affordable housing in India ?

What is the indicative size and potential of this segment in the country ?

Identifying factors that drive demand and constraints related to the supply value chain

Demographic Facts supporting the shift and focus towards the affordable homes category

Exploding urban population Need for housing in vicinity of commercial hubs

Rise in Seeker and Striver population to fuel demand for affordable housing

What are the various challenges faced by stakeholders involved in this sector ?

Pre emptive measures to take on specified challenges will ensure success within the sector