Indian real estate growing at 30%, is likely to touch US$ 90 billion by 2015 from the current level of US$ 14 billion and boost economic growth to between 9 to 10%, says a study.
The additional requirement of 370 million sq. ft. of space in urban areas by 2010 by IT, ITeS, financial services and organised retail has made real estate most lucrative providing returns ranging from 20 to 30% says the study by the Associated Chambers of Commerce and Industry of India (ASSOCHAM).
The Chamber President, Venugopal N. Dhoot said, “while US$ 10 billion is expected to flow into the sector by end 2008, by 2010, it might reach US$ 15 billion every year”.
According to the estimates, organized retail in India has a potential to add a business of about USD 48 billion by the year 2010. This is likely to create a demand for at least 220 million square feet of retail space by 2010.
The year 2006-07 witnessed organized retail growing at 25-30 per cent, experiencing a capital appreciation of 25-35 per cent. Close to 96 per cent of India’s retail sector is still unorganized, which is propelling interest of the domestic majors such as Reliance, A V Birla Group, Bharti as also of the global biggies including Wal-Mart and Texas.
The study said IT and ITES, Banking and Financial Services have in particular created a huge demand for office space. IT and ITES alone is expected to require 150 million sq. feet across urban India by 2010. Services are further expected to clock a double-digit growth in the future, keeping the demand of office space robust.