Real Estate Sector India 2017 2018 Outlook Affirmative With Steep Investments On The Back Of Macro Economic Changes
A favourable regulatory environment coupled with attractive
asset valuations has enhanced investor confidence by changing the perception of
Indian realty in the global arena. Interest from offshore equity investors,
large Indian corporates and high net worth individuals (HNIs) are likely to
bring in investments worth USD 7 billion into the sector this year, says a
report.
While office and residential are expected to remain traditional
drivers for the industry; alternate sectors, such as retail and warehousing
will also are also likely to be in the forefront, says a report by CBRE titled
Indian Real Estate in 2017 and Beyond released by CREDAI at its 17th Annual
International Convention, NATCON 2017 in London.
The report encapsulates the major policy related disruptions by
Government of India which are challenging the traditional operating environment
by setting a new foundation for change. According to the report, regulatory
measures such as RERA, GST and REITs are aimed at improving transparency in the
sector, increasing the share of organised segment and enhancing the overall
investor sentiment. This will help in catalysing ease of doing business in the
country while supporting corporate entities entering or expanding their
footprint in India.
It anticipates that breakthrough disruptions – regulation,
finance, customers and technology are likely to have positive insinuations on
the sector and will facilitate a new ecosystem which will be more conducive.
With RERA, GST and I-REITs becoming a reality in 2017, the
Government has taken a lead in challenging the operating fabric with regulatory
disruptors and making affordable housing the growth catalyst in the residential
segment, it says.
The report also looks at the changing customer preferences in
office, retail, residential and warehousing space. For instance, the dynamics
in office spaces are being disrupted with the entry of Millennials – over,
two-thirds of the Indian Millennials feel the quality of office design impacts
their productivity to a large extent.
In the warehousing segment – entry of international players is
ensuring that better and larger warehouses emerge in key markets; in the
residential segment - customers will have a say in operations with effective
grievance redressal. Customer experience has also become at the heart of
retail’s strategy which is fuelling future trends like customisation and hyper
customisation.
As per the survey, more than 40 percent of retailers in cities
such as Noida, Gurgaon, Delhi, Mumbai, Kolkata etc. preferred locating in the
malls, as they serve as experience destinations, as per the report.
“The government’s aggressive push to formalize, regulate and
encourage investment to the sector with a slew of measures like RERA, REITs is
consolidating India’s position on the global map. We believe that these
disruptions and encouraging trends will definitely manifest a more exciting
future which will be full of possibilities and opportunities for Indian
real-estate,” says Jaxay Shah, president, CREDAI National.
“In this burgeoning Indian economy, the one sector that has
emerged from the restraints of the past is real estate. The sector in India is
one of the key contributors and mainstays for India’s development as a nation.
Real estate in India continues to be in a dynamic phase and the pace at which
the four cornerstones – regulation, finance, customers and technology are
evolving, a more than incremental transformation in the sector is expected in
the coming years. In this report we have dwelled on how a strong foundation for
this change has already been laid with a conducive operating environment, the
future growth of the sector will be determined by many other factors,” says
Anshuman Magazine, chairman, India & South East Asia, CBRE.
