project on real estate

7/28/2019 project on real estate

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Industry Analysis of Real Estate

sector

By

Kumari

Mahes

Mary

Madhu


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Advantage India

2010-11

Market size:

USD55.6billion

Growing demand

Demand for residential propertyhas gone up due to increasedurbanisation

Growing economy driving demandfor commercial and retail space

Advantage

India

Increasing investments

FDI in real estate of more thanUSD11.25 billion between April 2000

and May 2012

In FY12, the real estate sectoraccounted for 2.0 per cent of total FDI inflows into India

Attractive opportunities

Growing requirements of space

from sectors such as education

and healthcare

Growth in tourism providing

opportunities in the hospitalitysector

Policy support

Allocation of USD625 million for ruralhousing

FDI up to 100 per cent allowed with government permission for

developing townships and settlements


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Overview Has become one of the fastest growing markets in the world.

The growth of the industry is attributed mainly to a large populrising income level, and rapid urbanisation.

Comprises of four sub-sectors- housing(5-6%of GDP), retail, hoscommercial.

Government policies have been instrumental in providing for in

development. Adequate infrastructure forms a prerequisite for sustaining the

growth momentum of the economy.


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Segments in the Indian real estate

sector

Residential space

Commercial space

Real estate Retail space

sector

Hospitality space

SEZs

Fragmented market with few large players

Demand of over 300,000 units in the seven major cities in 2010

Few players with presence across India

Over 38.2 million sq ft demand in 7 major cities in 2011

FDI in multi- brand retail to boost demand

Fragmented market with few national players

Demand of around 15 million sq ft in major cities during 2011

A competitive market with many players

Over 121,000 hotel rooms in the country as of 2011

589 SEZs have been approved by the government so far

Majority of SEZs are in the IT/ ITeS sector


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Real estate being driven by policies andgrowing economy

Growth in tourism

Epidemologicalchanges

Easier financing

Urbanisation

Growth drivers Growing economy

Policy support


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Key Facts The Indian real estate market size is expected to touch US$ 180

2020.

Foreign direct investment (FDI) in the sector is expected to increUS$ 25 billion in the next 10 years, from present US$ 4 billion.

Demand is expected to grow at a compound annual growth rate19 per cent between 2010 and 2014.

The construction industry ranks third among the 14 major secto

India is going to produce an estimated 2 million new graduates fvarious Indian universities during this year, creating demand for million square feet of office and industrial space.


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Market Players

DLF,

Unitech,

Hiranandani Constructions,

Tata Housing,

Godrej Properties,

Omaxe,

Parsvanath, Raheja Developers,

Ansal Properties and Infrastructure

Mahindra Lifespace Developers Ltd


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Target Acquirer Value ($ million)

Caraf Builders DLF Assets ltd 696.5Cowtown Land DvlpPvt

Ltd

Lodha Group 513.6

Compact Disc film city Jeff Morgan 320

Oceanus Real Estate Warburg Pincus 318

Indiabulls Properties Pvt Ltd Indiabulls Property Invest

Trust

223.1

Embassy Property Blackstone 200

Major acquisitions in real estate sector in India


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POLICY INITIATIVESGovernment Initiatives

FDI up to 100 per cent is allowed under the automatic route intownships, housing, built-up infrastructure and constructiondevelopment projects.

The Ministry of Housing & Urban Poverty Alleviation has plannintroduce a singlewindow system for clearance of all real estateprojects across the country.

The Government has sanctioned projects worth Rs 41,723 crorbuilding of 1,569,000 houses/dwelling units for economicallyweaker/lower income group sections under the Ministrys flagsJawaharlal Nehru National Urban Renewal Mission.

S f h i i i i k i h i


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Some of the initiatives taken in the unibudget 2013-14

For homes and flats with a carpet area of 2,000 square feet or mo

value of Rs 1 crore or more, which are high-end constructions, whcomponent of services is greater, rate of abatement reduced frompercent.

Rs 6,000 crore (US$ 1.08 billion) were given to Rural Housing Fund

National Housing Bank plans to set up Urban Housing Fund. Rs 2,0

be provided to the fund in the current financial year.


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Investments

Private equity investments in real estate investment, revealapproximately Rs 118.54 billion is available with private equ

PE investments in real estate was recorded at Rs 16.38 billio2013, which is 46% lower when compared to first half of 20

The total value of investments in the residential segment re

Rs 9.3 billion in H1 2013 witnessed a drop of 48% over last y In 2013, the highest value of private equity investments is n

Pune at Rs 7.8 billion followed by Mumbai at Rs 4billion, NCbillion, and Bengaluru at Rs 1billion.

S f th j i t t i th


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Some of the major investments in theIndian real estate sector are:

Ashiana Housing Ltd plans to foray into Gujarat's real estate with its f

worth Rs 100 crore at Halol . Mr Akhilesh Yadav, Chief Minister of Uttar Pradesh (UP) has inaugura

the foundation of development projects worth Rs 3,337 crore pertainGreater Noida and Yamuna Expressway.

Wave Infratech plans to invest Rs 500 crore to set up its first affordabventure in the NCR area

Mahindra Life space Developers has bought the stake of private equitin its joint venture residential project at Chennai. The buyout of the sestimated to be around Rs 70 crore.

Godrej Properties Ltd (GPL) has signed a development management awith United Oxygen Company Pvt Ltd to develop residential housing pBengaluru


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Challenges

lack of clear land titles, absence of title insurance,

absence of industry status,

lack of adequate sources of finance,

shortage of labour,

rising manpower and material costs,

approvals and procedural difficulties.


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Investment opportunities

The sector is expected to grow at the rate of 30 per cent ovedecade.

The real estate market could start to perform better as the eFDI norms will begin to show results during the second half year.

The economy will also recover in 2013 which in turn will perreal estate sector in India.

With the government trying to introduce developer and buyfriendly policies, the outlook for real estate in 2013 does loopromising.


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THANK YOU

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