Future of Commercial Real Estate in India
Asma Javed, VP-Leasing, Retail & Commercial, Supertech Ltd expresses her views on the India’s commercial real estate (CRE) market.
According to Asma Javed, a strong occupier interest followed with the ascent of real estate land developers, and the section of institutional capital have gone about as catalysts for the development in CRE. “The sector has earned strong interest from different sectors including technology, banking, financial services etc. With the rise in co-working spaces and development of flexible spaces a sustainable annual growth in office absorption is seen,” she stated.
She shares, “Indians, from time immemorial have invested in gold and real estate. Before, the real estate investment was limited to residential peripherals. Now with the changing times the investments in the industry are expanding boundaries.”
As per Asma Javed, the future of this commercial real estate industry will be impacted by the following factors:
Real estate investment trust (REIT)
Real estate investment trust (REIT), a famous instrument all around the world, was presented in India a couple of years prior pointed toward drawing in interest in the real estate by tapping rent-yielding resources. With the beginning of REITs, the commercial sector could observer better capital appreciation, when contrasted with the residential sector. The arrangement of REITs isn’t only an incredible shelter to financial backers, however a benefit to the developers also. For developers, it could open the worth of their business assets. They can view at REITs as a vehicle to exit, at an amazingly alluring capitalisation rate, subsequently, decreasing their significant debts.
Decline in Covid cases:
With the onset of this pandemic, real estate industry is the worst hit industry among others. It saw shutting down of the offices and hence reducing the demand of the commercial real estate. Now, with the situation normalising to an extent and the government relaxing the restrictions, office spaces are opening steadily.
Recovery across the Metropolitan cities:
The real estate industry is reviving in stages. More so in the cities, inferable from their high speed and versatile way of life. Be that as it may, Tier-2 and Tier-3 urban communities are additionally expected to drive recovery and development, going ahead. Reasons being the normalising of work distribution and work from anywhere-models by enterprises and clients alike.
Rise of Co-working Spaces:
Co-working spaces will play a vital role in the future of the industry. The workforce is scattered and we have learnt to co-exist from anywhere within an enterprise during this past year. Accordingly a JLL Report predicts that by 2023 India’s co-working market is likely to cross 50 million square feet. It is further said that adaptable office space is probably going to develop by a normal of around 15-20 percent for each annum over the course of the following three-to-four years, albeit this trajectory won’t be straight.
“The commercials real estate is gaining momentum. Owing to the smooth conditions that lay ahead, the future of commercial real estate looks promising,” Asma Javed concluded.