The joint report of Knight Frank and National Real Estate Development Council (NAREDCO) can scare those countries which may be ahead of India in real estate, but the growth is quite slow. In which the name of China can be taken from the chief. Where the real estate sector is going through a huge crisis. According to the report of both, India's real estate sector can reach $ 5.8 trillion by 2047, which will increase from the current share of 7.3 percent to 15.5 percent of the country's GDP.
The 'India Real Estate: Vision 2047' report states that the residential segment will have a major share in the real estate sector. It states that by the year 2047, when India will complete 100 years of independence, the size of India's economy is estimated to be between $33-40 trillion. The report states that private equity investment in the Indian real estate sector has grown steadily over the past two decades and is expected to reach $54.3 billion by 2047, an annual growth of 9.5 per cent, from an estimated figure of $5.6 billion in 2023 .
There will be so much expansion till 2047
Rajan Bandelkar, President of NAREDCO India, said that by the year 2047, a significant expansion of the Indian economy would come from real estate. The multi-dimensional economic expansion will spur demand across all asset classes – residential, commercial, godown, industrial land development, etc. To meet the growing needs of the economy and the consumption needs of the individuals, work will be done at a rapid pace.
According to Knight Frank India, an estimated 230 million units of housing will be required in India over the next 25 years. Housing demand is expected to remain concentrated in affordable housing, which will gradually shift towards mid-segment and luxury housing. The share of low-income households will decline from the current 43 per cent to 9 per cent in 2047.
There will also be an increase in the residential and warehousing sector.
Niranjan Hiranandani, National Vice President, NAREDCO, said that increasing GDP in the Indian real estate sector will give a boost to commercial and industrial real estate, thereby attracting global investors to Grade A assets. Emerging alternative asset classes will also play an important role in mobilizing investments and boosting investor confidence.
According to the report, apart from the office and retail sectors, the REIT will also expand into residential and warehousing sectors in the coming years. Builders can also consider venturing into REITs for alternative asset classes such as data centres, hospitality, healthcare and education.
The REIT covers 84.9 million sq ft, of which 75.9 million sq ft is dedicated to office assets and 9 million sq ft to retail properties. Additionally, around 21.3 million sq ft of construction work is underway within the REIT sector, which is expected to be completed within 1-2 years.
Office stock will increase
According to Knight Frank estimates, 69 per cent of the working population will be formally employed by 2047, supporting an economic expansion of US$36 trillion. In terms of market value, the estimated office stock is expected to generate potential production equivalent to US$ 473 billion in 2047. The report states that the office stock in the top eight cities of India is expected to increase from 278 million sq. ft. in 2008 to a total of 898 million sq. ft. in 2022.
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