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Over 50 per cent builders exit top real estate markets due to entry of large players in nine Indian cities

Loknath Das July 9, 2019 Real Estate Comments Off on Over 50 per cent builders exit top real estate markets due to entry of large players in nine Indian cities
Over 50 per cent builders exit top real estate markets due to entry of large players in nine Indian cities

construction, building, architecture, civil engineering, Real Estate

A long-drawn sales slowdown coupled with the entry of large players has forced over 50 per cent of developers to exit the realty market in top nine Indian cities, with the number of operating developers going down from 3,538 in 2011-12 to just 1,745 in 2017-18.

Experts hint that there could be more churn in the space going forward.

According to a report by data analytics firm PropEquity, the number of developers in nine major cities — Gurugram, Noida, Mumbai, Thane, Pune, Bengaluru, Hyderabad, Chennai, and Kolkata, has shrunk by 51 per cent in just six years from FY 2011-12 to FY 2017-18.

The data shows that the number of developers has declined by a staggering 70-80 per cent in Gurugram, Noida, and Chennai during the period under review.

Kolkata, Bengaluru and Hyderabad saw a drop of 60-65 per cent in the number of operating builders, while this number stood at 48 per cent in Thane, 32 per cent in Mumbai and 19 per cent in Pune.

Most of the small-scale developers in these cities have either exited the market or joined hands with larger developers, the report said, adding that the implementation of the new realty law RERA is also leading to the transformation of the industry for the better.

Unorganised players in the segment have been unable to cope up with mounting issues in the market year-after-year, with the RERA rollout and increased regulatory compliance taking its toll too.

Further, the entry of big corporates like Tata, Mahindra, Godrej, Piramal, and Adani in this business, and delays in delivery of apartments to buyers, have been a major catalyst for this consolidation process.

As a result of this consolidation, PropEquity said, the share of top 10 developers operating in each of these nine cities has increased in terms of both sales as well as launches.

[“source=newindianexpress”]

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