Spurred by enhanced financial development, infrastructural developments, reduce price of living, eye-catching true estate rates, and work from home dynamic, demand for housing is increasing in Tier 1, 2, 3 cities, which has forced the nation’s significant and listed true estate developers to set their sights on these cities.
According to an ANAROCK study, listed players now have their crosshairs educated on tier 2 and 3 cities. For instance, Bengaluru-based Puravankara Ltd and Sobha Ltd will expand into Kochi, Coimbatore, Present City, Hosur, Thrissur and Thiruvananthapuram. Southern India is a significant focus region for these players.
The listed developers regarded as are Brigade Enterprises, Godrej Properties, Kolte-Patil, Mahindra Lifespace Developers, Prestige Estates, Puravankara Ltd and Sobha Ltd.
Data from the economic presentations of the leading 7 listed realty businesses reveals that they are gearing up to launch close to 92.5 mn sq ft of new residential space inside the next 1-2 years. Apart from the leading 7 cities, they are also zeroing in on these significant tiers 2 and 3 cities – and at least 70-75% of this provide may perhaps be launched in FY2022 itself.
These listed developers’ corresponding economic presentations information from prior economic years indicates a steady y-o-y development in new launches. Despite COVID-19 in FY2021, the total new launches by these leading 7 listed players rose by 11% against the preceding FY – from approx. 28.3 mn sq ft in FY2020 to approx 31.37 mn sq ft in FY2021.
The present expansion pipeline of approx. 92.5 mn sq ft clearly indicates that robust, listed developers will continue to dominate the new residential provide and accelerate their marketplace share acquire.
Commenting on the identical, Anuj Puri, Chairman, ANAROCK Property Consultants, says, “COVID-19 has driven a lot of latent demand into tier 2 and 3 cities. This demand is driven by the improved economic growth, infrastructural developments, lower cost of living and more attractive real estate prices in these cities. However, it is the new work from home dynamic which has worked most strongly in their favour as they continue to attract migrant professionals riding on the WFH option.”
The days when these cities’ residential provide was dominated by neighborhood players will quickly be more than. Demand is also chasing projects by top developers, so their expansion into tier 2 & tier 3 cities is a provided.
“These players have extremely ambitious expansion plans for the next two years,” adds Puri. “Even if 70% of their total projected new supply of approx. 92.5 mn sq ft is launched in FY2022, they will have doubled their footprint as against the preceding financial year 2021, when they launched approx. 31.37 mn sq ft residential space.”
The robust housing sales by the leading 7 listed true estate players in the prior economic years have been a enormous self-confidence booster for them. Data indicates that these listed players cumulatively sold approx. 32.61 mn sq ft of housing in FY2021 in spite of the pandemic – an enhance of 7% more than FY2020, when approx. 30.45 mn sq ft region was sold.