MINI PROJECT-2 REPORT

On

REAL ESTATE

Submitted to

Dr. A.P.J. Abdul Kalam Technical University,

LUCKNOW

For the partial fulfilment of

MASTERS OF BUSINESS ADMINISTRATION

BATCH 2021-2023

Submitted to Submitted by
Dr. Namita Nath Aakash Gupta

Assistant Professor Roll No. 2108200700001

MBA II SEM

AJAY GARG INSTITUTE OF MANAGEMENT KUMAR

27th K.M Stone, NH—24, Delhi Hapur Bypass Road,
Adhyatmik Nagar, Ghaziabad- 201009

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 CERTIFICATE

This is to certify that the report titled REAL ESTATE INDUSTRY ANALYSES
has been carried out by Aakash Gupta under my guidance as a part of Mini Project
2 work for MBA at Ajay Kumar Garg Institute of Management, Ghaziabad, Uttar
Pradesh.

Date: Signature
Place: Ghaziabad ………………………

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 ACKNOWLEDGEMENT

I owe my thanks to all the people who helped and supported us during writing this
report.

I thank Dr. Namita Nath for guiding me and correcting my drafts with care. I am
highly obliged for her painstaking efforts and attention to detail.

I would also thank my Institution AKGIM, Ghaziabad for supporting me with the
infrastructure without which this report would have been a distant reality.

………………………

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 Table of Content

1. INDUSTRY OVERVIEW PAGE NO.

o Industry Overview 5-6
o Market Growth Rate 7-8
o Market Structure 9
o Competitive Landscape 10
o Regulations 11-12
o Industry Growth Rating 13-14
o Industry Drivers 15
2. TOOLS USED TO ANALYZE
o SWOT 16
o PESTLE 17-18
o PORTERS 5 FORCE Model 19-20
o BUSINESS TRENDS 21
o INTERNATIONAL OUTLOOK 22-23
o CRITICAL ISSUES 24-25

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 Industry Overview

Real estate sector is one of the most globally recognized sectors. It comprises of four sub sectors -
housing, retail, hospitality, and commercial. The growth of this sector is well complemented by the
growth in the corporate environment and the demand for office space as well as urban and semi-urban
accommodations. The construction industry ranks third among the 14 major sectors in terms of direct,
indirect and induced effects in all sectors of the economy.

In India, the real estate sector is the second-highest employment generator, after the agriculture sector.
It is also expected that this sector will incur more non-resident Indian (NRI) investment, both in the
short term and the long term. Bengaluru is expected to be the most favoured property investment
destination for NRIs, followed by Ahmedabad, Pune, Chennai, Goa, Delhi and Dehradun.

By 2040, real estate market will grow to Rs. 65,000 crore (US$ 9.30 billion) from Rs. 12,000 crore
(US$ 1.72 billion) in 2019. Real estate sector in India is expected to reach US$ 1 trillion in market size
by 2030, up from US$ 200 billion in 2021 and contribute 13% to the country’s GDP by 2025. Retail,
hospitality, and commercial real estate are also growing significantly, providing the much-needed
infrastructure for India's growing needs.

India’s real estate sector saw over 1,700 acres of land deals in the top 7 cities in 1 year. Foreign
investments in the commercial real estate sector were at US$ 10.3 billion from 2017-21. As of February
2022, Developers expect demand for office spaces in SEZs to shoot up after the replacement of the
existing SEZs act.

As per ICRA estimates, Indian firms are expected to raise >Rs. 3.5 trillion (US$ 48 billion) through
infrastructure and real estate investment trusts in 2022, as compared with raised funds worth US$ 29
billion to date.

The office market in the top eight cities recorded transactions of 22.2 msf from July 2020 to December
2020, whereas new completions were recorded at 17.2 msf in the same period. In terms of share of
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sectoral occupiers, Information Technology (IT/ITeS) sector dominated with a 41% share in the second
half of 2020, followed by BSFI and Manufacturing sectors with 16% each, while Other Services and
Co-working sectors recorded 17% and 10%, respectively.

Around 40 million square feet were delivered in India in 2021. It is expected that the country will have
a 40% market share in the next 2-3 years. India is expected to deliver 46 million square feet in 2022.

According to Savills India, real estate demand for data centres is expected to increase by 15-18 million
sq. ft. by 2025.

In 2020, the manufacturing sector accounted for 24% of office space leasing at 5.7 million square feet.
SMEs and electronic component manufacturers leased the most between Pune, Chennai and Delhi
NCR, followed by auto sector leasing in Chennai, Ahmedabad and Pune. The 3PL, e-commerce and
retail segments accounted for 34%, 26% and 9% of office space leases, respectively. Of the total PE
investments in real estate in Q4 FY21, the office segment attracted 71% share, followed by retail at
15% and residential and warehousing with 7% each.

India’s gross leasing volume in the top 8 cities stood at 16.2 this was 12.4% quarter to quarter growth in
2021. India’s net absorption of the office market stood at 11.56 million square feet in quarter four of
2021. This was an 86% rise QoQ.

Between July 2021 and September 2021, a total of 55,907 new housing units were sold in the eight
micro markets in India (59% YoY growth).

In the third quarter of 2021 (between July 2021 and September 2021), new housing supply stood at
~65,211 units, increased by 228% YoY across the top eight cities compared with ~19,865 units
launched in the third quarter of 2020.

In 2021-22, the commercial space is expected to record increasing investments. For instance, in
October 2021, Chintels Group announced to invest Rs. 400 crore (US$ 53.47 million) to build a new
commercial project in Grogram, covering a 9.28 lakh square feet area.

According to the Economic Times Housing Finance Summit, about 3 houses are built per 1,000 people
per year compared with the required construction rate of five houses per 1,000 population. The current
shortage of housing in urban areas is estimated to be ~10 million units. An additional 25 million units
of affordable housing are required by 2030 to meet the growth in the country’s urban population.

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 Market Growth Rate

 Currently, retail accounts for a small portion of the Indian real

estate market.
Scenario  Organised retailers are few and the organised retail space is
mostly developed by residential/office space developers.

 Booming consumerism in India.

 Organised retail sector is growing 25-30% annually.
Key
 Entry of MNC retailers.
drivers  India’s population below 30 years of age and having exposure to global
retail is expected to drive demand for organised retail.

 According to Anarock, a property consultant, India is likely to have 100

new malls by 2022. Of this number, 69 malls will be built in the top seven
metropolis and the remaining 31 malls will be in Tier 2 & 3 cities.
 In September 2021, Amazon India signed a lease agreement with GMR
Notable Logistics Park for warehousing space of 10 lakh sq. ft. in Hyderabad for 20
trends years.
 In October 2021, Lulu Group launched its new shopping mall in Bengaluru
and announced to complete two more properties in India in the next six
months.

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 Market Structure

1. Demographics
Demographics are the data that describes the composition of a population, such as age, race,
gender, income, migration patterns, and population growth. These statistics are an often
overlooked but significant factor that affects how real estate is priced and what types of properties
are in demand. Major shifts in the demographics of a nation can have a large impact on real estate
trends for several decades.

2. Interest Rates 
Interest rates also have a major impact on the real estate markets. If you're considering buying a
home with a mortgage it is beneficial to research interest rates using a mortgage calculator.
Changes in interest rates can greatly influence a person's ability to purchase a residential property.
That is because the lower interest rates go, the lower the cost to obtain a mortgage to buy a home
will be, which creates a higher demand for real estate, which again pushes prices up. 

3. The Economy
Another key factor that affects the value of real estate is the overall health of the economy. This is
generally measured by economic indicators such as the GDP, employment data, manufacturing
activity, the prices of goods, etc. Broadly speaking, when the economy is sluggish, so is real
estate.

4. Government Policies/Subsidies
Legislation is also another factor that can have a sizable impact on property demand and
prices. Tax credits, deductions, and subsidies are some of the ways the government can
temporarily boost demand for real estate for as long as they are in place. Being aware of current
government incentives can help you determine changes in supply and demand and identify
potentially false trends.

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Competitive Landscape

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 Regulations

1. The Reserve Bank of India (RBI) policy

 In October 2021, the RBI announced to keep benchmark interest rate unchanged at
4%, giving a major boost to the real estate sector in the country. The low home loan
interest rates regime is expected to drive the housing demand and increase sales by
35-40% in the festive season in 2021.

2. Housing for economically weaker section

 On July 09, 2020, Union Cabinet approved the development of Affordable Rental
Housing Complexes (AHRCs) for urban migrants and poor as a sub-scheme under
Pradhan Mantri Awas Yojana - Urban (PMAY-U).
 Since 2019, 41,75,214 houses have been sanctioned and 20,39,571 houses have
been delivered to urban poor under the Pradhan Mantri Awas Yojana-Urban
(PMAY-U).

3. FDI

 The Government has allowed 100% FDI for townships and settlements development
projects.
 Provision for reduction in minimum capitalisation for FDI investment from US$ 10
million to US$ 5 million to boost urbanisation.
 In January 2018, the Government allowed 100% FDI in single-brand retail trading
and construction development without Government approvals.
 Indian real estate is expected to attract a substantial amount of FDI over the next
two years, with US$ 8 billion capital infusion by FY22.

4. Land Acquisition Bill

 In December 2014, the Government passed an ordinance amending the Land

Acquisition Bill.
 This ordinance is intended to speed up the process for industrial corridors, social
infra, rural infra, housing for the poor and defence capabilities.

5. REITs

 Real Estate Investment Trusts (REITs) in non-residential segment will open

channels for both commercial and infrastructure sector. In March 2019, Embassy
Office Parks, India’s first REIT, went public.
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  First REIT raised Rs. 4,750 crore (US$ 679.64 million) and was launched in early
2019 by global investment firm, Blackstone, and realty firm, Embassy group.
 In July 2021, the Securities and Exchange Board of India lowered the minimum
application value for Real Estate Investment Trusts from Rs. 50,000 (US$ 685.28)
to Rs. 10,000-15,000 (US$ 137.06 - US$ 205.59) to make the market more
accessible to small and retail investors.
 According to EY, > US$ 9.7 billion has been raised in India via real estate
investment trusts (REITs) and infrastructure investment trusts (InvITs).

6. Govt-backed Stress Fund

 The Special Window for Completion of Construction of Affordable and Mid-

Income Housing (SWAMIH I) supported housing projects have started witnessing
fresh sales and collection of dues from existing homebuyers, In November 2020,
SBICAP Ventures Ltd. managed fund cleared investments worth >Rs. 13,200 crore
(US$ 1.78 billion) for 136 projects and has started deploying funds across 36
projects

7. Stamp Duty
 The Ministry of Housing and Urban Affairs has recommended all the states to
consider reducing stamp duty of property transactions in a bid to push real estate
activity, generate more revenue and aid economic growth.
 National Real Estate Development Council – Maharashtra announced zero stamp
duty on housing sales until December 31, 2020.

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 Industry Growth Rating

 Real estate sector in India is expected to reach US$ 1 trillion in market size by 2030, up
from US$ 200 billion in 2021. India’s real estate market is estimated to increase at a CAGR
of 19.5% during 2017- 2028. The market is forecast to reach US$ 650 billion, representing
13% of India’s GDP by 2025.
 Increasing share of real estate in the GDP would be supported by increasing industrial
activity, improving income level and urbanisation.
 The Government launched 10 key policies for the real estate sector:
 Real Estate Regulatory Act (RERA)
 Benami Transactions Act
 Boost to affordable housing construction
 Interest subsidy to home buyers
 Change in arbitration norms
 Service tax exemption
 Dividend Distribution Tax (DDT) exemption
 Goods and Services Tax (GST)
 Demonetisation
 PR for foreign investors

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13
Industry Drivers

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 SWOT

STRENGTHS

 It is an investment asset that increases in value over time.

 It is less volatile (risky) than other investment assets particularly equities.
 The owner of a real estate asset has full rights over the asset and can add value to it through
refurbishment and good management.
 It is used to hedge inflation risk and is a good store of wealth.
 Preferred collateral/security by financial institutions.
 There is no single market for real estate i.e. it can be traded at auctions or open markets by
estate agents and surveyors.

WEAKNESSES

 Ownership rights cannot be easily transferred.

 It is a highly illiquid asset.
 It requires a large capital to invest in.
 Low supply.

OPPORTUNITIES

 Global demand for real estate is strong and high.

 Real estate is poised for rapid growth.
 Potential to diversify into other sectors.
 New sectors offer great potential i.e. student accommodation & care homes.

THREATS

 Economic slowdown may affect demand i.e. periods of recession.

 Competition from other investment asset classes such as equities and bonds.
 Seasonal demand may affect prices

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 Pestel

The Real Estate Industry has traditionally been a very profitable industry with great demand from
buyers and sellers. Population increases, globalization and urbanization have constantly created a
need for people to find houses to live in.   

This industry, like many others, is heavily influenced by its external environment. Using PESTEL,
a widely used Strategic Planning and Management tool (Political, Economic, Social,
Technological, Ecological/Environmental, Legal), here are the factors impacting the real estate
industry:

Political:

 Political stability
 Pricing Legislature
 Trade regulations and tariffs related to real estate
 Taxes

Economic:

 Market cycles (growth/decline e.g. 2006/2007 bubble, 2008/2009 crash)

 Unemployment rates
 Labor costs
 Inflation

Social:

 Cultural – attitudes, leisure interests, health, environmental consciousness

 Demographics and skills
 Education level
 Class structure

Technology:

 Artificial Intelligence
 Rise of platforms such as Zillow, Trulia, Redfin, WeWork, Airbnb etc.
 IoT (Internet of Things)

Ecological: 

 Climate change
 Flooding
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  Weather
 Air and water pollution

Legal:

 Anti-trust Laws
 Zoning
 Legal framework for contract regulation

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 Porter’s 5 Force Model

Bargaining Power of Supplier

The bargaining power of suppliers depends upon various underlying factors related to the industry
and its supply chain. Usually, suppliers have moderate to high bargaining power in the industry.
The supply chain of the property development industry consists of two main sources of supply, the
first being the raw material and the other one is then skilled labor. Large scale companies usually
have vertically integrated supply chains and if they need material outside of their integrated
structure they can avail bulk purchase discounts to lower their cost. On the other hand, labor,
specifically skilled manpower, has higher bargaining power, because they are in short supply at any
particular time. Labour unproductivity can cause delays and increase cost, and the main reason for
that is the poor labor surveillance and the unskilled craftsmen (Ameh & Osegbo, 2011).
Cumulatively, suppliers in the real estate development industry can exert moderate to high
bargaining power

Bargaining Power of Buyers

It depends on various factors, but buyers usually have moderate bargaining power in the real estate
industry. The primary buyers are the individuals or, if any, property management firms. The other
factors that can influence the price from the consumer’s perspective are the experience of the
consumer, availability of the information, and the ability to use that information to negotiate a
better price (Wilhelmsson, 2008). High consumer bargaining power can negatively impact the
company’s margins. In China, in the urban centers, buyers are well informed and they have high
bargaining power because of knowledge of the market and availability of other reasonable
accommodation due to the high competition in the industry. Considering the above-mentioned facts
buyers can exercise moderate to high bargaining power.

Competitive Rivalry in the Market

Poly development operates in the highly competitive sector, and the company is part of one of the
massive state-owned groups of companies. It has vast experience in the real estate industry with a
unique portfolio. As the company operates globally, it is exposed to global competition but its
significant business is in China. The company’s major competitors are Swire Properties Limited
(SPL) and China Gezhouba Group Company Limited (CGGC). CGGC is one of the largest
contractors in the world, and it was among the ENR Top 250 International Contractor in 2015
(ENR, 2015). CGGC made $ 17.11 billion in revenue in 2020 with a net income of $650.61 million
(DNB, 2021). In the financial year 2020, SPL posted revenue of $ 1.72 billion and a net income of
$ 528.10 million (Nikkei Asian Review, 2021). In the same financial year, Poly development
posted $ 35.53 billion in revenues (Nikkei Asian Review, 2021). The competition remains high due
to the presence of well-established private and mega state-owned organizations.

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 Threat of Substitutes

In the real estate industry threat of the substitute remains low, due to the stiff nature of the industry.
The parts of the industry can be improved with the help of technology and the use of advanced
robotics, but on the whole, it is difficult to overhaul a massive industry with magnanimous value.
The global real estate industry will be worth $ 2.7 trillion by 2021 (PR Newsire, 2021). Real estate
development companies have started to offer bundled services and improved the consumer-facing
side of the business. In China, people are still more inclined to lease property in the urban centers,
where there are more employment and educational resources. Its principal benefit is that
responsibility falls on the property management company. Shortly, this trend is likely to follow, so
the threat of better alternative products remains low.

Threat of New Entrants

The threat of new entrants remains low in large-scale real estate development due to the usual
barriers of entry associated with the industry. Despite the high return on offer, the real estate sector
is capital intensive and requires a significant capital investment upfront, this acts as a deterrent for
potential new businesses. This remains true for the global real estate development landscape, other
barriers such as capital acquisition and further acquisition of technology and skills are necessary.
As analyzed

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 EMERGING TRENDS

India’s realty sector is on the cusp of a turnaround, according to market experts. The real estate sector,
particularly the residential segment, is already showing signs of “healthy growth” in 2022, according to
reports. This buoyancy is vindicated by another report, which says supply in the residential segment jumped
27% between January and September, 2021 when compared to the entire 2020 supply.
This new-found traction has pushed up sales by 5 to 7% and many market watchers feel that new supply and
sales quantum could reach pre-pandemic levels this year, marked as the bounce-back year. While interest
rates are slated to rise in the second half of the year, prices could go up even further, given the new impetus
in the market.

So what are the emerging trends?

The market momentum has surely been driven by cheaper home loans and demand for bigger apartments
with a clutch of built-in amenities in gated communities. Much of this new demand is fueled by the WFH
(work from home) culture. Young professionals want more space with a touch of sophistication and all the
creature comforts they can get to maintain a lifestyle many of them have got used to. An extra room has thus
become routine customer preference. Also, the pandemic has taught us the value of community-driven
living and the need for safety and peace of mind.

The trend was visible in 2021 itself when there was decent demand in the mid segment (apartments priced
between Rs 40 and 80 lakh) and premium units (priced at Rs 80 lakh to 1.5 cr). A consumer survey study
has revealed a distinct buyer tilt towards properties north of Rs. 90 lakhs. This uptrend is only expected to
get more prominent this year, with a 5% capital value growth” for residential properties projected in
calendar 2022.

Increased FDI flow and the comfort and reassurance guaranteed by the RERA have been key contributors to
the growth, boosting NRI investments as well. We have also seen the emergence of online buying and
selling of homes as a preferred mode in this period, prodding the real estate sector to be agile and adapt to
digitization and innovation swiftly. Social media marketing is playing a major role in influencing decision-
making, more so among young professionals in the IT/ITeS sector where many companies are on a hiring
spree.

Another noteworthy trend emerging is the exponential growth in the demand for warehousing space, as the
e-commerce segment continues to scale new heights with game-changing innovations. This sector is
projected to grow at a CAGR of 20% in the financial year ’22-’23, with e-commerce contributing a
whopping 36% to the total warehousing transaction business. Speed and new tech will play a crucial growth
in this warehousing boom.

The pandemic has also underlined the need for flexi workplaces, which could still be a future asset segment.
As employers continue to re-strategize workplace dynamics, quite a few co-working players are in the fray,
building up inventory, for which they expect takers galore. However, a lot depends on which course the
virus takes, going forward, even as we are on the threshold of endemicity, doctors opine. However, Covid
has thrown several curve balls at us as soon as we have let our guard down. So perhaps, this is a wait-and-
watch segment and the jury is still out.

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 International outlook

State of uncertainty 

Despite the prolonged disruption from COVID-19 and the paradigm structural shifts in the way we
live and work, real estate continues to attract capital, demonstrating its stability and appeal over
other asset classes. Despite widespread economic uncertainty, 2021 represented a record-breaking
year for the global real estate realm, with global commercial sales volumes exceeding the 2020
total by 59% and the previous peak observed in 2019 by 22% - far above the expectations voiced in
last year’s Global Outlook.

This extraordinary level of activity was driven by worldwide demand for residential and industrial
property, as well as the premium between property yield and interest rates that is being observed
across most global markets. That being said, rising macroeconomic uncertainty has given rise to a
clear sense of caution among the interviewees. In particular, inflationary pressure - one of the
major concerns raised last year and an even greater concern today - has accelerated significantly. In
January, inflation in Europe hit 5.1 percent and in the US 7.5 percent, the fastest annual rise there
for 40 years.

While the rate and scale of the economic recovery from the pandemic may vary from country to
country, the interviews for the three regional Emerging Trends reports and for Global Emerging
Trends also highlight some key cross-regional similarities in sector issues and preferences.

Over the last year, logistics has come to epitomise the potential risks and rewards of real estate
investment – a sort of lightning rod for bullish and bearish comment about the asset class as a
whole. With a build-up of capital that favours real estate over other asset classes, logistics remains
the main draw, alongside residential. That trend shows no sign of stopping this year or next, say the
industry leaders canvassed for this report, although the hesitancy around pricing persists. 

Nowhere is the impact of COVID-related upheaval more profound than in the office sector, which
has long represented the foundation of commercial real estate portfolios. Two years on from the
outbreak of COVID-19 there is still no clear direction here. A disconcertingly broad range of
industry perspectives exists about how some form of hybrid working model will affect office
demand. But in any conceivable outcome, companies will be leasing less space in the future. New
hires and added space required for social distancing are unlikely to fill the resulting vacancies.

For investors, the corollary of this widespread problem has been a reallocation of capital from
unflavoured sectors into various forms of housing. And again, the growing attraction of residential
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has been reflected in Emerging Trends’ North American and European editions over several years.
Interviewees for Global Emerging Trends suggest the same supply-demand dynamics that have led
to the housing affordability issue are, in turn, creating a compelling resiliency from a capital
markets perspective. The sector benefits from lower vacancies and better risk-adjusted returns than
commercial assets.

Financing decarbonisation

The Organisation for Economic Co-operation and Development calls for $7 trillion to be invested
each year between now and 2030 for the world to meet climate and development objectives. “That
will mean an historic reallocation of capital in real estate,” one Global Emerging Trends
interviewee says of how that will affect the built environment.

That reallocation has the potential to enable real estate, a major contributor to global carbon
emissions, to play its part in decarbonising the world economy. The shifting of equity and debt
towards green buildings and away from assets with no chance of reducing carbon emissions is
already well under way.

In concert with governments and financial regulators, the organisations providing the equity and
debt that drive real estate and determine how it acts have the power to influence the industry’s
approach to issues like decarbonisation and social impact. Equity investors have stepped up their
game and are leading the way when it comes to directing capital towards decarbonising real estate
whereas lenders have been mostly following. There is so much more to be done by lenders and
regulators if the industry is to meet its targets. 
But there is now great uncertainty about whether the surging energy costs resulting from the
Ukrainian crisis will speed up or undermine the global transition from fossil fuels to cleaner energy
sources to fight climate change. The danger is that high prices will spur further investment in oil
and gas production, at least in the short term, just as they did in previous crises. For the longer
term, the hope is that acute problems of energy security will act as a wake-up call to governments
about the radical economic transformation they need to implement under the ESG agenda.

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 CRITICAL ISSUES

Unending project delays

Problem: Construction delays have plagued the sector for quite some time now. Now, while
developers are at fault for using the funds of one project for another, we also need to look at other
underlying factors.

For a housing project in a metro city, a developer needs over 40 regulatory approvals for starting
construction. It takes anywhere from several months to a year or even more. It not only delays a
project but also increases the cost of the property by 10-20% for both buyers and developers.

Solution: While RERA has addressed the issue of right usage of funds, the sector certainly needs a
single-window clearance system to streamline and fasten the approval mechanism.

Land availability

Problem: At present, there are several ongoing infrastructure projects in the country that are
expected to change the dynamics of real estate in India. These include the Metro Rail in major
cities and infrastructure projects such as road widening or expansion. However, acquiring land for
such projects is a herculean task.

Solution: The government should revise the Land Acquisition Resettlement and Rehabilitation Act
2013.

Unlocking land parcels is also essential for affordable housing. At present, substantial land parcels
are reserved by central and state government entities such as the railways, ports, and defence
authorities.

Further, the government needs to accelerate the process of digitising land records for making land-
related transactions much more transparent.

High property prices

Problem: Property prices in Indian markets have gone way beyond the buying capacity of the
common man. Until 2016, taxes accounted for almost 25-30% of the total cost of a property. With
the Goods and Service Tax (GST), the tax on under-construction properties has come down to
12%. However, the stamp duty and registration charges are not subsumed into GST.

Post the announcement of “Housing for All by 2022”, several affordable projects have entered the market.
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But unfortunately, a majority of the projects with ‘affordable’ tag are coming up in the peripheries where the
trunk infrastructure is not in place. This is a classic case where the supply is vacant.

Solution: Government and developers must join hands to develop necessary social and physical
infrastructure simultaneously with the project.

Outdated building bye-laws

Our cities are gasping for space, and the current Floor Space Index (FSI) norms in the cities are not
on par with the current requirements. It said that the permitted FSI in Indian cities is very low – in
the range of 1 to 1.5.

State governments need to revisit the FSI norms.

Funding

Problem: Developers face a major challenge with funding. Lack of industry status does not allow
developers to access funds at an affordable rate (except for affordable projects).

Solution: Industry status is the need of the hour. Additionally, it is also essential to incentivise
developer building affordable and green homes.

Further, it is equally important to make Real Estate Investment Trusts (REITs) attractive for
investors by providing tax sops. It will open more channels for foreign funding in the real estate
sector in India.

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 REFERENCE

https://www.pwc.com/us/en/industries/financial-services/asset-wealth-management/real-estate/
emerging-trends-in-real-estate.html

https://www.ibef.org
https://cre.org/external-affairs/2020-21-top-ten-issues-affecting-real-estate/
https://www.linkedin.com/pulse/swot-analysis-real-estate-sector-rotimi-akinlose
https://www.linkedin.com/pulse/real-estate-industry-macro-analysis-shuchi-agrawal
https://www.porteranalysis.com/porters-five-5-forces-of-poly-real-estate/
https://indiancompanies.in/top-10-real-estate-company-in-india/

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