Real estate developers have acquired a record 2,181 acres of land in the last 17 months, between January 2022 and May 2023. According to a report by JLL India, a real estate management and investment firm, this has an estimated development potential of around 209 million square feet (msf).
Valued over Rs 26,000 crore, the acquisition comprised 104 separate land deals.
"Around 84 percent of the land — with a development potential of about 165 million sq ft — is for proposed residential projects, as developers are strategically investing in land parcels encouraged by robust residential sales," the report said. The land for the proposed residential projects has an estimated sales potential of around Rs 1.22 lakh crore, the report added.
"Driven by unprecedented levels of residential sales, real estate developers are acquiring land for building supply pipelines for the future. Interestingly, about 84 percent of the 2,181 acres (around 1,822 acres) is for proposed residential developments," the report said.
Delhi NCR, Chennai, Mumbai Metropolitan Region, and Bengaluru lead in terms of total land area transacted (about 1,576 acres), accounting for a 72 percent share. With a development potential of around 150 msf, the land was acquired in 79 separate deals.
Pune, Kolkata, and Hyderabad together account for a 9 percent share with cities like Surat, Ahmedabad, Jaipur, Lucknow, Nagpur, Panchkula, and Kurukshetra making up the rest.
In Delhi NCR, the submarkets of Panipat and Gurugram lead with a combined share of 73 percent of land transactions in the last 17 months.
In terms of the number of transactions, Delhi NCR and Mumbai Metropolitan Region lead, with 53 transactions recorded in the last 17 months.
Real estate developers who actively acquired land includes Godrej Properties, M3M, Max Estates, Birla Estates, and Mahindra Lifespaces, among others.
"Over 100 land transactions with a development potential of 209 million sq ft in the last 17 months is a visible indication of the positive sentiment for the real estate sector. Interestingly, most of the land transactions were for residential development due to the surge in demand," Samantak Das, Chief Economist and Head of Research and REIS, JLL India, added.
According to the report, in spite of rising interest rates and prices over the last 12 months, 62,000 housing units were sold in Q1 22-23, making it the quarter with the highest sales in the last 15 years . "This growth has been fuelled by the collective effort of all stakeholders, who swiftly adapted to changing consumer preferences," it said.
``We expect land transactions to remain steady in 2023, with developers expanding their land banks on the back of expected moderation in interest rates, growing demand for housing, and support from institutional funding agencies,’’ Das added.
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