Currently, India is a land of opportunities for industrialists and builders. Contrary to its neighboring nations, India has ample of amazing opportunities for real estate investors and builders. Showing a relatively high pick up in investment demand in the middle of 2015, the economic growth reached 7.4% in the second quarter of the financial year then. India is attracting more FDI lately and has become a global investment destination.
Lets have a brief look at last year’s real estate trends and find out how the last year’s trends are affecting current industrial real estate development this year.
Commercial real estate trends
India’s office space absorption reached its second highest in 2015 after 2011, standing 35 million sq. ft. Such large shift in these trends came from corporates, as they wanted to implement their growth plans. Due to the increasing demands the rents rose across cities in 2015. This pace was faster in the secondary business districts and peripheral business districts and the central business districts. The micro markets witnessed more leasing activity last year and we are expecting the trend to be same this year.
According to real estate industry developers the demand will remain consistent this year as well. Corporate occupiers will remain firm on their expansion plans as the demand is still very high in the commercial real estate business. This 2016, we noticed higher occupancy of grade-B office spaces and a huge demand for leased spaces.
Residential real estate trends
Investors were expecting rise in residential real estate trends in 2015, just like commercial real estate but no growth was seen in this domain last year. Although, sales picked up in cities like Mumbai, Hyderabad and Bangalore. People were keen on buying due to developers’ attractive schemes, term deals and lower interest rates. The demand supply mismatch was seen across the country but the scenario was completely different in Mumbai, Pune and Hyderabad.
In contrast to the last year’s trends demands picked up in many B-grade cities and the trajectory showed upward growth in big cities and adjoining suburbs.
Lets have a brief look at last year’s real estate trends and find out how the last year’s trends are affecting current industrial real estate development this year.
Commercial real estate trends
India’s office space absorption reached its second highest in 2015 after 2011, standing 35 million sq. ft. Such large shift in these trends came from corporates, as they wanted to implement their growth plans. Due to the increasing demands the rents rose across cities in 2015. This pace was faster in the secondary business districts and peripheral business districts and the central business districts. The micro markets witnessed more leasing activity last year and we are expecting the trend to be same this year.
According to real estate industry developers the demand will remain consistent this year as well. Corporate occupiers will remain firm on their expansion plans as the demand is still very high in the commercial real estate business. This 2016, we noticed higher occupancy of grade-B office spaces and a huge demand for leased spaces.
Residential real estate trends
Investors were expecting rise in residential real estate trends in 2015, just like commercial real estate but no growth was seen in this domain last year. Although, sales picked up in cities like Mumbai, Hyderabad and Bangalore. People were keen on buying due to developers’ attractive schemes, term deals and lower interest rates. The demand supply mismatch was seen across the country but the scenario was completely different in Mumbai, Pune and Hyderabad.
In contrast to the last year’s trends demands picked up in many B-grade cities and the trajectory showed upward growth in big cities and adjoining suburbs.
Warehouses and Industries
Investors were seriously happy with huge rise in market price of warehouses and industrial real estate in 2015 and the trend is still way up in 2016. Since, the states can now come up together and leverage advanced policies under the “The make in India” project, which has triggered industrial growth. Maharashtra, Andhra Pradesh and Gujarat, these three states are taking advantages of “Make in India” scheme and attracting a large number of investors. Haryana, Punjab and Karnataka are also taking bold steps towards this endeavor. Online time-bound approvals will further improve the prospects of doing business.
The warehouse industry reached its infection point last year and this year it took a huge leap when the good and services (GST) tax rolled out. Apart from GST, e-commerce is also driving demand for warehouses industries in India. In 2015, 25% of warehouse absorption was from the e-commerce industry and it continuous to be a big demand driver in 2016 as well. Real estate developers have invested USD 2-3 billion dollars in last three years.
There is a huge demand for organized Grade-A and Grade-B warehouses from past few years
Hospitality
The real estate hospitality trends are transforming from being development driven to more transaction driven. The early signs of these transformations were witnessed in middle of 2015. In the current scenario, hotel real estate market is ready for acquisition and consolidation. Last year there were nine hotel transactions, which is a major upscale from last two years. All these transactions were majorly luxurious and upscale. Its middle of 2016 and we are seeing the same or rather escalation in hotel transactions.
Education and Healthcare
Presently, healthcare and education sector are facing huge shortfalls in supply and we expect that they will be met by the end of this year by various national and international players. The education and healthcare estate market will take a little bit time to grow as the supply is still very low. Emerging residential nodes can lead to the growth of healthcare and education in coming years.
If you are thinking of investing in the real estate market then we suggest you to take this plunge with care. Consult INDOSPACE to know the dynamics of real estate business.
Investors were seriously happy with huge rise in market price of warehouses and industrial real estate in 2015 and the trend is still way up in 2016. Since, the states can now come up together and leverage advanced policies under the “The make in India” project, which has triggered industrial growth. Maharashtra, Andhra Pradesh and Gujarat, these three states are taking advantages of “Make in India” scheme and attracting a large number of investors. Haryana, Punjab and Karnataka are also taking bold steps towards this endeavor. Online time-bound approvals will further improve the prospects of doing business.
The warehouse industry reached its infection point last year and this year it took a huge leap when the good and services (GST) tax rolled out. Apart from GST, e-commerce is also driving demand for warehouses industries in India. In 2015, 25% of warehouse absorption was from the e-commerce industry and it continuous to be a big demand driver in 2016 as well. Real estate developers have invested USD 2-3 billion dollars in last three years.
There is a huge demand for organized Grade-A and Grade-B warehouses from past few years
Hospitality
The real estate hospitality trends are transforming from being development driven to more transaction driven. The early signs of these transformations were witnessed in middle of 2015. In the current scenario, hotel real estate market is ready for acquisition and consolidation. Last year there were nine hotel transactions, which is a major upscale from last two years. All these transactions were majorly luxurious and upscale. Its middle of 2016 and we are seeing the same or rather escalation in hotel transactions.
Education and Healthcare
Presently, healthcare and education sector are facing huge shortfalls in supply and we expect that they will be met by the end of this year by various national and international players. The education and healthcare estate market will take a little bit time to grow as the supply is still very low. Emerging residential nodes can lead to the growth of healthcare and education in coming years.
If you are thinking of investing in the real estate market then we suggest you to take this plunge with care. Consult INDOSPACE to know the dynamics of real estate business.