India’s booming real estate industry, growing at a scorching 30 per cent and estimated to touch $60 billion by 2010, has caught the fancy of global realtors and investors who have pumped in or are looking to invest heavily in the sector.
Indian real estate industry, which is currently pegged at $16 billion, is witnessing increased interest from several international developers, primarily from the Middle-East, South-East Asia and Europe.
During this week itself, Donald Trump Jr of US-based Trump Organisation announced it was scouting for partners to foray into the country’s realty market, while Dubai-based DAMAC Properties said it would invest up to $5 billion (about Rs 20,000 crore) to develop properties in India.
Looking for partners
Early this week, Merrill Lynch & Co also bought 49 per cent equity in seven mid-income housing projects of DLF in Chennai, Bangalore, Kochi and Indore for Rs 1,481 crore.
The projects would be developed in about 7-8 years. Dubai-based Nakheel and Hines of the US had earlier this year tied up with DLF to develop properties in India. DLF has formed a JV with Limitless Holding, a part of Dubai World, to develop a Rs 60,000-crore township project in Karnataka.
“We are looking for JV partners to enter into India. We are interested in the major cities for investment,” Trump Organisation’s Executive VP (Development and Acquisition) Donald Trump Jr had said.
DAMAC Holding Chairman Hussain Sajwani said: “We plan to invest between $3 to 5 billion in Indian market to develop properties in Mumbai, Delhi, Bangalore and Hyderabad.” Trump is looking at cities like Mumbai, Delhi, Hyderabad and Bangalore, where the IT sector has developed.
Large potential
Mr Sajwani noted that the Indian property market has become very expensive in the last three years, but there was still a large potential for growth. Israel’s Elbit Medical Imaging had announced last month a tie-up with a leading developer in Bangalore for joint development of a large-scale mixed-use project in the city. The revenue generated from the project is estimated to exceed $4 billion.
According to Ernst & Young latest report on Indian real estate, prominent Middle-East based developers such as Nakheel Group and Signature Group, from Dubai, announced their projects in India. “An increasing interest from Israeli-based firms was witnessed entering the realty space,” the report said.
Leading developers from South East Asia which have evinced interest in Indian realty market include Jurong Group and Keppel Land Asia of Singapore, Shanghai Urban Construction (Group) Corporation of China, it said.
