Bharti Real Estate Sticks to North India Focus Amidst Pan-India Expansion Trend
Bharti Real Estate will not expand beyond its home market in North India, unlike its peers, and will instead focus on building a $2 billion business district near Delhi airport.
Bharti Real EstateNorth IndiaReal EstateIndiaBusinessReal Estate NewsSep 15, 2024
The company has leased land from Delhi Airport and plans to build 17 million square feet of office and commercial space in multiple phases. The first phase has already seen the development of 1.5 million square feet, and the second phase will entail the construction of another 7 million square feet.
Bharti Real Estate's decision to stick to its home market in North India comes at a time when most real estate companies are expanding to new regions. Competitors such as Prestige Group, Delhi Land & Finance (DLF Ltd), and Godrej Properties, among others, have been on an expansion spree in new regions.
However, Bharti Real Estate's focus on its home market may prove to be a great strategy. According to Pradeep Mishra, CMD at Oram Developments, developing within one's home region offers a distinct advantage due to a deeper understanding of land-related issues, government policies, and other localized factors.
The company is also closely watching the government's divestment plans of marquee properties at prime locations, which may include the sale of The Ashok Hotel in New Delhi.
The Indian real estate sector is capitalizing on the growing demand for residential units and office spaces across the country. The rising confidence in the improving economic prospects has also spurred office occupiers to expand their operations in India.
India's commercial real estate sector is also experiencing a boom, driven largely by global capability centers (GCCs). The commercial market is valued at $40.71 billion and is expected to grow to $106.05 billion by 2029, with a compound annual growth rate (CAGR) of 21.1%.
Major developers with a pan-India presence will continue to dominate, setting new industry standards and leading to a more structured and competitive environment.
In terms of office space, Bengaluru remained the largest, acing with the highest sales volumes, while cities like Mumbai and the National Capital Region also recorded their best half-yearly performances.
The pan-India demand for office spaces is likely to cross 70 msf in 2024, fuelled by strong economic fundamentals and significant push in investments into the country's physical and digital infrastructure.
The country's real estate sector is also witnessing a premiumisation trend in the housing market. The number of residential units launched in the first half of 2024 reached a record high of nearly 160,000, with a 170% hike in the premium category (properties worth ₹3-5 crore) and 116% rise in luxury properties (costing above ₹5 crore).
Housing sales in Hyderabad touched a fresh high in H1 2024, with nearly 18,600 units sold during that time. Home sales in Mumbai also climbed to a 13-year high with approximately 47,000 units sold, 16% higher than the same period in the previous year.
While many are expanding beyond home markets, there are companies like Raymond, who also continue to focus on their home market of Mumbai.
The approach of Bharti Real Estate to focus on its home market in North India may prove to be a great strategy, as it allows the company to leverage its deep understanding of the local market and capitalize on the growing demand for office and residential spaces.
Frequently Asked Questions
What is Bharti Real Estate's expansion plan?
Bharti Real Estate plans to build 17 million square feet of office and commercial space in multiple phases at the Global Business District at Worldmark Aerocity near Delhi airport.
Why is Bharti Real Estate focusing on its home market in North India?
Bharti Real Estate is focusing on its home market in North India due to its deep understanding of the local market and the growing demand for office and residential spaces.
What is the current trend in the Indian real estate sector?
The Indian real estate sector is witnessing a premiumisation trend in the housing market, with a record high number of residential units launched in the first half of 2024.
What is the expected growth rate of the commercial real estate sector in India?
The commercial real estate sector in India is expected to grow at a compound annual growth rate (CAGR) of 21.1% to reach $106.05 billion by 2029.
Which cities are performing well in terms of office space sales?
Bengaluru, Mumbai, and the National Capital Region are performing well in terms of office space sales, with Bengaluru remaining the largest market.
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