Chennai's Property Market Thrives with Strong Demand for Housing and Commercial Spaces
A report by Anarock highlights the robust growth in Chennai's real estate sector, with a 15% increase in housing supply and a significant rise in commercial property absorption.
Real EstateProperty MarketChennaiHousing SupplyCommercial PropertyReal Estate NewsDec 12, 2025
The report, titled ‘Real Estate and Infrastructure Driving Growth in Tamil Nadu,’ was published by Anarock, one of India’s leading independent real estate consultancies. It revealed that South Chennai continues to dominate the market, accounting for nearly three-quarters of all new launches this year. Developers are particularly active along the OMR and GST corridors, pushing forward new projects to meet the growing demand.
Anuj Puri, chairman and founder of Anarock Group, emphasized during the inaugural session of the summit that property prices have risen by 38% over the past five years, currently standing at Rs 7,010 per square foot. Despite this increase, absorption rates have kept pace, leaving Chennai with the second-lowest unsold stock among major metros. This balance between price increases and absorption suggests a healthy and sustainable market.
The commercial property market in Chennai is also witnessing significant growth. Net absorption has reached 4.6 million square feet in the first nine months of 2025, already matching last year’s full-year levels and on track to set a seven-year high. Puri noted that this trend is driven by the increasing number of global capability centers (GCCs) in the state. Over 250 GCCs are now operational across Tamil Nadu, with Chennai alone hosting 10% of India’s total GCC footprint. Coimbatore has also emerged as a top tier-II destination for new GCC setups.
However, the sector is not without its challenges. Ranjeeth Rathod, managing director of DRA, highlighted the rising costs of raw materials, which have impacted the prices of affordable homes. P. Kruthivas, founder and managing director of Pushkar Properties Pvt Ltd, emphasized the need for reforms in the approval process for real estate projects. Other industry leaders, including C. Velan, CEO of CEEBROS Chennai, Sriram Iyer, director and CEO of TVS Emerald Limited, and Bhupesh Nagarajan, co-chairman of FICCI Tamil Nadu State Council and CMD of Indira Group of Companies, also contributed to the discussions.
Shiv Das Meena, chairman of the Tamil Nadu Real Estate Regulatory Authority (TNRERA), noted the impressive GDP growth of Tamil Nadu, which stands at 11.19%, significantly higher than the national average of 6.5%. This economic performance is expected to further bolster the real estate sector, driving both residential and commercial growth in the coming years.
In conclusion, Chennai's real estate market is experiencing robust growth, driven by strong demand for both residential and commercial properties. While challenges such as rising material costs and regulatory hurdles need to be addressed, the overall outlook remains positive, supported by a thriving economy and increasing investment in infrastructure.
Frequently Asked Questions
What is the current housing supply in Chennai for the first nine months of 2025?
Chennai's housing supply has reached 19,675 units in the first nine months of 2025, marking a 15% increase from the previous year.
How has the commercial property market in Chennai performed in the first nine months of 2025?
Net absorption in the commercial property market has reached 4.6 million square feet in the first nine months of 2025, already matching last year’s full-year levels and on track to set a seven-year high.
What is the current price per square foot for properties in Chennai?
Property prices in Chennai have risen by 38% over the past five years, currently standing at Rs 7,010 per square foot.
What challenges are currently facing the real estate sector in Chennai?
The sector is facing challenges such as rising costs of raw materials, which impact the prices of affordable homes, and the need for reforms in the approval process for real estate projects.
What is the GDP growth rate of Tamil Nadu compared to the national average?
The GDP growth rate of Tamil Nadu stands at 11.19%, significantly higher than the national average of 6.5%.
