Retail sector facilitating real estate growthApart from the IT and ITES industry influencing the Indian real estate sector, India is also getting into the knowledge based manufacturing industry on a large scale. Retail, one of India's largest industries, has presently emerged as one of the most dynamic and fast paced industries of our times with several players entering the market.The contemporary retail sector in India which is reflected in sprawling shopping centers and multiplex- malls is also contributing to large scale investments in the real estate sector with major national and global players investing in developing the infrastructure and construction of the retailing business. Over 500 shopping arcades are under construction phase and will be operational by 2008.
Accounting for over 10 per cent of the country's GDP and around eight per cent of the employment retailing in India is gradually inching its way toward becoming the next boom industry. And if industry experts are to be believed, the prospects of both the sectors are mutually dependent on each other.
Another emerging trend in real estate sector in India is investment in the hospitality or hotel industry. The exceptional boom in inbound tourism and the IT sector has also led to an unprecedented shortage of rooms, with hotels all over the country witnessing their highest-ever occupancy rates.
SEZs - the emerging investment optionMoreover, as real estate sector expands beyond the city limits with government promoting industrial belts, real estate developers are eyeing special economic zones (SEZs) as an extension of their business. Several upcoming special economic zones are also expected to provide the momentum to the commercial office space development in related area where the land comes cheaper; and a SEZ developer is entitled for tax exemptions like a 10-year corporate tax holiday.
On the whole, Indian real estate sector is slated to mark the growth to $40-50 billion in the next five years. Also, India is witnessing developments of hi tech cities, a trend that has been embraced by most Indian cities.
Further, India's improving image, as a corporate base for Asian markets and strong growth opportunities in emerging sectors such as financial services, pharmaceuticals, telecommunications, and biotechnology will also boost demand and broaden the occupier base.
To be continued tomorrow......................
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