Real estate developers have acquired around 2,181, acres of land area in the last 17 months (January 22 – May 2023) valued over INR 26,000 crore, with an estimated development potential of around 209 million sq. ft in 104 separate land deals. Around 578 acres (27%) of the land, out of these 2,181 acres, was acquired in the first five months of 2023 alone. The data indicates that branded developers have successfully closed many land transactions in top metros as well as tier 2 and 3 cities driven by the resilience shown by the real estate sector.
Delhi NCR, Chennai, Mumbai Metropolitan Region and Bengaluru lead in terms of total land area transacted accounting for 72% share (around 1,576 acres) having a development potential of around 150 million sq. ft. in 79 separate land deals. Pune,Kolkata and Hyderabad together account for 9% share. The rest was contributed by cities like Surat, Ahmedabad, Jaipur, Lucknow, Nagpur, Panchkula, and Kurukshetra. In Delhi NCR, submarkets of Panipat and Gurgaon lead with a combined share of 73% in Delhi NCR land transactions in the last 17-month period.
In terms of the number of transactions Delhi NCR and Mumbai Metropolitan Region lead with 53transactions recorded in the last 17-month period.
Real estate developers who actively acquired land included Godrej Properties, M3M, Max Estates, Birla Estates, and Mahindra Lifespaces among others.
Note: 1. NCR includes NCT of Delhi, Gurgaon, Noida, Ghaziabad, Faridabad, Bahadurgarh, Sonipat, and Panipat. MMR includes Mumbai, Thane, Panvel, Palghar, and Khalapur.
2. Others include Surat, Sanand, Ahmedabad, Jaipur, Lucknow, Nagpur, Panchkula, and Kurukshetra
3. The development potential is estimated based on the permissible FAR/FSI allowed in the respective micro markets where the land has been transacted. 4. Sales Potential is estimated considering the loading component of the development potential area and the average saleable price in the respective micro markets where the land has been transacted.
The residential segment is leading the way in land transactions locked in the last 17 months. Driven by unprecedented levels of residential sales, real estate developers are acquiring land for building relevant supply pipelines for the future. Interestingly, out of the total 2181 acres, 84% of the total land area transacted (around 1,822 acres) are for proposed residential developments. These residential land transactions have an estimated development potential of around 165 million sqft. The sales potential from these residential deals is estimated to be around INR 122,000 crore.
LAND TRANSACTION SNAPSHOT (January 2022-May 2023)
Total number of land deals from January 2022-May 2023
104
Value of land transactions
INR 26,000 Crores
Area of land transacted
2,181 Acres
Estimated development potential
209 million sqft
Area of land transacted for proposed residential developments (includes plotted developments, group housing, townships)
1,822 Acres
Estimated development potential for proposed residential developments
165 million sqft
Estimated Sales Potential of land transactions with proposed developments
INR 122,000 crore
With a surge in demand for housing, developers are actively acquiring land for new housing projects. In 2022, residential sales registered a decadal high with 215,000 units sold across the top seven cities, which is almost like the 2010 sales of 216,762 units. Sales in 2022 increased by 68% Y-o-Y with more than 50,000 units sold in each of the four quarters. Also, Residential launches during the same period stood at 247,000 units, the highest in over a decade and next to the previous high of 281,000 units in 2010.
Further in Q1 2023, sales of 62,000 housing units were recorded marking the highest quarterly sales in the last 15 years despite rising interest rates and prices in the last 12 months. This growth has been fuelled by a collective effort of all stakeholders, who swiftly adapted to changing consumer preferences.
Samantak Das, Chief Economist and Head of Research and REIS, India, JLL, said, “Over 100 land transactions with a development potential of 209 million sqft in last 17 months are a visible indication of the positive sentiment for the real estate sector. Interestingly, most of the land transactions were for proposed residential development due to the surge in demand leading to optimism in developers to build a robust supply pipeline. These residential transactions are estimated to have a sales potential of INR 122,000 crore . Going forward in 2023, we expect land transactions to remain steady 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. The launches of new residential projects are expected to strengthen further through new land acquisitions in strategic locations and growth corridors.
