Construction work underway at a residential site in Noida.
Credit: PTI File Photo
Bengaluru: With an election year (2024) messing with developers’ plans for project launches, 2025 will see a spurt of activity on this front, said property consultant Anarock Research.
Its analysis out on Tuesday pointed to the fact that at the beginning of the current financial year (FY25), the top 11 listed developers announced plans to launch 253.16 million square feet (msf) of new supply across cities over the next few years. Of this total planned supply, just 23 per cent (or 57.15 msf) were launched in the first half of FY25 (April to September 2024). This translates into a strong new supply pipeline over the coming quarters.
New housing supply in 2024 remained relatively tepid compared to peak-year 2023 due to national and state elections delaying approvals.
Among the top listed players, Bengaluru-based Prestige Group with 75 msf has the highest new supply planned over the next few years. Of this, they launched just 10.05 msf (or 13 per cent) in H1 FY25 across geographies. In early September, the group indicated an overall project pipeline of at least 60 msf.
Signature Global has the second-highest launch plan with 29.3 msf over the next few years. In H1 FY25, they launched approximately 9.5 msf (32 per cent) of their scheduled supply.
Prashant Thakur, Regional Director and Head, Research, Anarock Group, said, “Amid high demand for their branded offerings, they have been aggressively tapping the capital markets via qualified institutional placements (QIPs) for their expansion. Several of these players raised as much as Rs 12,801 crore via QIPs in the first nine months of 2024. Much of these funds are earmarked for land acquisition and to launch residential projects. These players are more than adequately funded.”
In another reflection of the high demand, inventory overhang across the top seven cities is down to 14 months by September 2024-end, from 17 months in the corresponding period of 2023. This is the lowest inventory overhang in the last decade and will prompt developers to add more supply to the market.
"City-wise, Hyderabad has the highest inventory overhang of 19 months among the top cities, while Bengaluru has the lowest at just eight months," said Thakur. In the last two years, Bengaluru saw its unsold stock drop by six months.