Report Overview

India Commercial Real Estate Market – Industry Trends & Forecast Report, 2030

India Commercial Real Estate Market size was estimated at USD 54.56 billion in 2023. During the forecast period between 2024 and 2030, India Commercial Real Estate Market size is projected to grow at a CAGR of 21.5% reaching a value of USD 213.32 billion by 2030. Prominent drivers of the market include government initiatives such as the Smart Cities Mission and Make in India, coupled with robust infrastructure development encompassing metro rail networks, expressways, and airports, are significantly enhancing India's urban landscape. These developments are fostering improved connectivity, logistics efficiency, and overall urban development, thereby attracting businesses and fueling the growth of the commercial real estate sector. The COVID-19 pandemic temporarily disrupted the commercial real estate market, with a notable decline in new office space absorption in 2022. However, the market is demonstrating resilience, with net office absorption rebounding in early 2023. Simultaneously, the retail and hospitality sectors are experiencing robust growth, underpinned by substantial institutional investment. Also, the increasing demand for flexible, comfortable, and convenient office spaces across various industries is driving office space absorption. The integration of technology, including artificial intelligence, virtual reality, and data analytics, is revolutionizing the commercial real estate industry by enhancing customer experiences, facilitating efficient transactions, and optimizing property management.

Commercial Real Estate – Overview

Commercial real estate refers to properties used exclusively for business-related purposes or to generate income, rather than for residential living. This category includes a wide range of property types, such as office buildings, retail spaces, warehouses, industrial facilities, hotels, and multifamily apartment buildings. Commercial real estate is typically leased to tenants for business operations, and the value of such properties is often determined by the income they generate through rent or lease agreements. Investing in commercial real estate can involve direct property ownership, real estate investment trusts (REITs), or other forms of collective investment schemes.

India Commercial Real Estate Market

Growth Drivers

Increasing Economic Growth

India's economic growth serves as a primary driver of the commercial real estate sector. With the GDP averaging around 6-7% annually, the expanding economy fuels corporate expansion, leading to increased demand for office spaces, retail outlets, and industrial facilities. Both multinational corporations and domestic firms are actively seeking prime locations in major cities like Mumbai, Delhi, Bangalore, and Chennai, resulting in a competitive market for commercial developments. Furthermore, government initiatives such as Make in India and Digital India are accelerating industrial growth, which in turn drives the need for industrial and logistics spaces. Economic policies and reforms, including the Goods and Services Tax (GST) and the Real Estate (Regulation and Development) Act (RERA), are enhancing transparency and boosting investor confidence. These reforms help streamline the commercial real estate sector, mitigating risks and making the market more attractive to both domestic and international investors.

Growing Urbanization

Rapid urbanization is significantly shaping India's commercial real estate sector by concentrating economic activities in urban centers like Mumbai, Delhi, Bangalore, and Chennai. As cities expand, the demand for commercial spaces, including office buildings, retail outlets, and mixed-use developments, continues to grow. Urbanization not only increases population density in these areas but also necessitates the development of additional commercial and residential spaces to meet the needs of the growing urban population. Peripheral areas of major cities are also witnessing substantial commercial development, driven by improved connectivity through metro rail projects, highways, and other infrastructure improvements. This trend towards urbanization is creating new opportunities for commercial real estate, as more businesses and residents move into these expanding urban areas.

Challenges

High Real Estate

High real estate prices are a significant factor restraining the growth of the India Commercial Real Estate Market. As property costs in prime urban locations continue to escalate, businesses face increased financial burdens when acquiring or leasing commercial spaces. These rising costs can deter both domestic and international companies from investing in new office spaces, retail outlets, or industrial facilities, ultimately slowing the expansion of the commercial real estate sector. Additionally, high real estate prices reduce the overall affordability and attractiveness of commercial properties, limiting opportunities for smaller businesses and startups to enter or expand within key markets.

Impact of Escalating Geopolitical Tensions on India Commercial Real Estate Market

Escalating geopolitical tensions among countries across regions could have a significant impact on the growth of India Commercial Real Estate Market. These tensions can lead to economic uncertainty, disrupting foreign investments and slowing the expansion of multinational corporations in India. As international investors become more cautious, capital inflows into the commercial real estate sector may decline, leading to reduced demand for office spaces, retail outlets, and industrial facilities. Additionally, geopolitical instability can affect global supply chains, increasing construction costs and causing delays in real estate projects. This environment of uncertainty may also influence domestic businesses, leading them to postpone expansion plans, further constraining the growth of the commercial real estate market in India.

India Commercial Real Estate Market

Segmental Coverage

India Commercial Real Estate Market – By Property Type

By property type, India Commercial Real Estate Market is Office, Retail, Industrial, Healthcare, and other (including Multifamily and Hospitality) segments. The office segment holds the highest share in India Commercial Real Estate Market by property type. It is driven by robust economic recovery and a successful vaccine rollout that has bolstered investor confidence. As the economy rebounds and the need for co-working spaces increases, developers are optimistic about a strong resurgence in office leasing. Research from Colliers India shows a 49% surge in office space supply to 32.8 million sq. ft from January to September in 2023 across six major cities, a significant increase from the previous year. Bengaluru and Hyderabad have been leading in new office supply, while Chennai and Ahmedabad have also seen notable rises in leasing activity. Despite a slight overall decrease in new office supply by 1%, specific cities like Chennai and Delhi-NCR have experienced substantial growth, reflecting the ongoing strength and expansion of the office sector. Companies continue to lease office spaces for daily operations and professional services, with costs influenced by factors such as location, building quality, amenities, and market demand. The trend underscores the dominance of the office segment within India Commercial Real Estate Market.

India Commercial Real Estate Market – By Business Model

Based on business model, India Commercial Real Estate Market is divided into Sales, Leasing, Property Management, and Real Estate Investment Trusts (REITs) segments. The REITs segment holds the highest share in India Commercial Real Estate Market by business model, surpassing other business models such as sales, leasing, and property management. By significantly lowering the minimum investment requirement from INR 25 lakh to INR 10 lakh, SM REITs have broadened accessibility, allowing retail investors to participate in the commercial real estate sector. These trusts offer a compelling advantage through regular rental income and potential for capital appreciation, backed by a mandate that 95% of their assets be in completed, revenue-generating properties. Additionally, the enhanced liquidity and transparency of listed units have contributed to their prominence. As a result, SM REITs are now a leading segment in the commercial real estate market, reflecting their substantial impact and high market share.

India Commercial Real Estate Market – By End User

On the basis of end user, India Commercial Real Estate Market is divided into Small and Medium-sized Enterprises (SMEs), Large Enterprises, Government Organizations, and Investors segments.

India Commercial Real Estate Market – By Region

The in-depth research report on India Commercial Real Estate Market covers the market in the country’s major regions: North India, South India, East India, and West India regions. South India holds the highest share in India Commercial Real Estate Market and is expected to maintain its dominance during the forecast period. According to a recent report by CBRE and the Confederation of Indian Industry, Bengaluru is expected to lead with an office stock of 330–340 million square feet by 2030. This remarkable growth underscores the city's significant role in the market, reflecting its robust expansion from 100 million square feet in 2013 to over 223 million square feet as of mid-2024. Bengaluru's dominance is attributed to its thriving technology, engineering, manufacturing, and BFSI sectors, which drive substantial demand for office space. The city's strategic development in peripheral regions, availability of large land parcels, and infrastructure initiatives further bolster its position. With ongoing advancements and high absorption rates, Bengaluru is set to continue its leading role in South India's commercial real estate landscape.

Competitive Landscape

Major players operating in India Commercial Real Estate Market include DLF Ltd, Godrej Properties Ltd, Housing Development and Infrastructure Ltd (HDIL), Oberoi Realty Limited, Equinox India Developments Limited, Prestige Estate Projects Ltd, Supertech Limited, Savills Property Services (India) Private Limited, Brigade Group, and Unitech Real Estate Pvt Ltd. To further enhance their market share, these companies employ various strategies, including mergers and acquisitions, partnerships, joint ventures, license agreements, and new product launches.

Recent Developments

• In August 2024 - DLF announced plans to expand its residential and commercial real estate operations into new markets like Mumbai and Goa.

Scope of the Report

By Property Type

• Office

• Retail

• Industrial

• Healthcare

By Business Model

• Sales

• Leasing

• Property Management

• Real Estate Investment Trusts (REITs)

By End User

• Small and Medium-sized Enterprises (SMEs)

• Large Enterprises

• Government Organizations

• Investors

By Region

• North India

• South India

• East India

• West India

1. Research Framework
   1. Research Objective
   2. Product Overview
   3. Market Segmentation
2. Executive Summary
3. India Commercial Real Estate Market Insights
   1. Industry Value Chain Analysis
   2. DROC Analysis
      1. Growth Drivers
         1. Increasing Economic Growth
         2. Growing Urbanization
         3. IT/ITeS Sector Growth
      2. Restraints
         1. High Real Estate Prices
         2. Infrastructure Challenges
         3. Environmental Regulations
      3. Opportunities
         1. Boom in Tier II & III Cities
         2. E-commerce Boom
         3. Growing Data Centers
      4. Challenges
         1. Financing Challenges
         2. Over Supply in Certain Markets
         3. Global Economic Uncertainties
   3. Technological Advancements/Recent Developments
   4. Regulatory Framework
   5. Porter’s Five Forces Analysis
      1. Bargaining Power of Suppliers
      2. Bargaining Power of Buyers
      3. Threat of New Entrants
      4. Threat of Substitutes
      5. Intensity of Rivalry
4. India Commercial Real Estate Market: Marketing Strategies
5. India Commercial Real Estate Market Overview
   1. Market Size & Forecast, 2019–2030
      1. By Value (USD Billion)
   2. Market Share & Forecast
      1. By Property Type
         1. Office
         2. Retail
         3. Industrial
         4. Healthcare
         5. Others (Multifamily, Hospitality, etc.)
      2. By Business Model
         1. Sales
         2. Leasing
         3. Property Management
         4. Real Estate Investment Trusts (REITs)
      3. By End User
         1. Small and Medium-sized Enterprises (SMEs)
         2. Large Enterprises
         3. Government Organizations
         4. Investors
      4. By Region
         1. North India
         2. South India
         3. East India
         4. West India
6. North India Commercial Real Estate Market
   1. Market Size & Forecast, 2019–2030
      1. By Value (USD Billion)
   2. Market Share & Forecast
      1. By Property Type
      2. By Business Model
      3. By End User
7. South India Commercial Real Estate Market
   1. Market Size & Forecast, 2019–2030
      1. By Value (USD Billion)
   2. Market Share & Forecast
      1. By Property Type
      2. By Business Model
      3. By End User
8. East India Commercial Real Estate Market
   1. Market Size & Forecast, 2019–2030
      1. By Value (USD Billion)
   2. Market Share & Forecast
      1. By Property Type
      2. By Business Model
      3. By End User
9. West India Commercial Real Estate Market
   1. Market Size & Forecast, 2019–2030
      1. By Value (USD Billion)
   2. Market Share & Forecast
      1. By Property Type
      2. By Business Model
      3. By End User
10. Competitive Landscape
    1. List of Key Players and Their Offerings
    2. India Commercial Real Estate Company Market Share Analysis, 2023
    3. Competitive Benchmarking, By Operating Parameters
    4. Key Strategic Developments (Mergers, Acquisitions, Partnerships, etc.)
11. Impact of Escalating Geopolitical Tensions on India Commercial Real Estate Market
12. Company Profiles (Company Overview, Financial Matrix, Competitive Landscape, Key Personnel, Key Competitors, Contact Address, Strategic Outlook, and SWOT Analysis)
    1. DLF Ltd
    2. Godrej Properties Ltd
    3. Housing Development and Infrastructure Ltd (HDIL)
    4. Oberoi Realty Limited
    5. Equinox India Developments Limited
    6. Prestige Estate Projects Ltd
    7. Supertech Limited
    8. Savills Property Services (India) Private Limited
    9. Brigade Group
    10. Unitech Real Estate Pvt Ltd
    11. Other Prominent Players
13. Key Strategic Recommendations
14. Research Methodology
    1. Qualitative Research
       1. Primary & Secondary Research
    2. Quantitative Research
    3.  Market Breakdown & Data Triangulation
       1.  Secondary Research
       2.  Primary Research
    4.  Breakdown of Primary Research Respondents, By Region
    5.  Assumptions & Limitations

*Financial information of non-listed companies can be provided as per availability.

**The segmentation and the companies are subject to modifications based on in-depth secondary research for the final deliverable.

List of Figures

Figure 1       India Commercial Real Estate Segmentation

Figure 2       India Commercial Real Estate Market Value Chain Analysis

Figure 3       Company Market Share Analysis, 2023

Figure 4       India Commercial Real Estate Market Size, By Value (USD Billion), 2019–2030

Figure 5       India Commercial Real Estate Market Share, By Property Types, By Value, 2019–2030

Figure 6       India Commercial Real Estate Market Share, By Business Model, By Value, 2019–2030

Figure 7       India Commercial Real Estate Market Share, By End User, By Value, 2019–2030

Figure 8       North India Commercial Real Estate Market Size, By Value (USD Billion), 2019–2030

Figure 9       North India Commercial Real Estate Market Share, By Property Types , By Value, 2019–2030

Figure 10     North India Commercial Real Estate Market Share, By Business Model, By Value, 2019–2030

Figure 11     North India Commercial Real Estate Market Share, By End User, By Value, 2019–2030

Figure 12     South India Commercial Real Estate Market Size, By Value (USD Billion), 2019–2030

Figure 13     South India Commercial Real Estate Market Share, By Property Types , By Value, 2019–2030

Figure 14     South India Commercial Real Estate Market Share, By Business Model, By Value, 2019–2030

Figure 15     South India Commercial Real Estate Market Share, By End User, By Value, 2019–2030

Figure 16     East India Commercial Real Estate Market Size, By Value (USD Billion), 2019–2030

Figure 17     East India Commercial Real Estate Market Share, By Property Types , By Value, 2019–2030

Figure 18     East India Commercial Real Estate Market Share, By Business Model, By Value, 2019–2030

Figure 19     East India Commercial Real Estate Market Share, By End User, By Value, 2019–2030

Figure 20     West India Commercial Real Estate Market Size, By Value (USD Billion), 2019–2030

Figure 21     West India Commercial Real Estate Market Share, By Property Types, By Value, 2019–2030

Figure 22     West India Commercial Real Estate Market Share, By Business Model, By Value, 2019–2030

Figure 23     West India Commercial Real Estate Market Share, By End User, By Value, 2019–2030

List of Tables

Table 1        India Commercial Real Estate Market Size, By Value (USD Billion), 2019–2030

Table 2        India Commercial Real Estate Market Share, By Property Types, By Value, 2019–2030

Table 3        India Commercial Real Estate Market Share, By Business Model, By Value, 2019–2030

Table 4        India Commercial Real Estate Market Share, By End User, By Value, 2019–2030

Table 5        North India Commercial Real Estate Market Size, By Value (USD Billion), 2019–2030

Table 6        North India Commercial Real Estate Market Share, By Property Types , By Value, 2019–2030

Table 7        North India Commercial Real Estate Market Share, By Business Model, By Value, 2019–2030

Table 8        North India Commercial Real Estate Market Share, By End User, By Value, 2019–2030

Table 9        South India Commercial Real Estate Market Size, By Value (USD Billion), 2019–2030

Table 10      South India Commercial Real Estate Market Share, By Property Types , By Value, 2019–2030

Table 11      South India Commercial Real Estate Market Share, By Business Model, By Value, 2019–2030

Table 12      South India Commercial Real Estate Market Share, By End User, By Value, 2019–2030

Table 13      East India Commercial Real Estate Market Size, By Value (USD Billion), 2019–2030

Table 14      East India Commercial Real Estate Market Share, By Property Types , By Value, 2019–2030

Table 15      East India Commercial Real Estate Market Share, By Business Model, By Value, 2019–2030

Table 16      East India Commercial Real Estate Market Share, By End User, By Value, 2019–2030

Table 17      West India Commercial Real Estate Market Size, By Value (USD Billion), 2019–2030

Table 18      West India Commercial Real Estate Market Share, By Property Types , By Value, 2019–2030

Table 19      West India Commercial Real Estate Market Share, By Business Model, By Value, 2019–2030

Table 20      West India Commercial Real Estate Market Share, By End User, By Value, 2019–2030

Table 21      DLF Ltd Company Overview

Table 22      DLF Ltd Financial Overview

Table 23      Godrej Properties Ltd Company Overview

Table 24      Godrej Properties Ltd Financial Overview

Table 25      Housing Development and Infrastructure Ltd (HDIL) Company Overview

Table 26      Housing Development and Infrastructure Ltd (HDIL) Financial Overview

Table 27      Oberoi Realty Limited Company Overview

Table 28      Oberoi Realty Limited Financial Overview

Table 29      Equinox India Developments Limited Company Overview

Table 30      Equinox India Developments Limited Financial Overview

Table 31      Prestige Estate Projects Ltd Company Overview

Table 32      Prestige Estate Projects Ltd Financial Overview

Table 33      Supertech Limited Company Overview

Table 34      Supertech Limited Financial Overview

Table 35      Savills Property Services (India) Private Limited Company Overview

Table 36      Savills Property Services (India) Private Limited Financial Overview

Table 37      Brigade Group Company Overview

Table 38      Brigade Group Financial Overview

Table 39      Unitech Real Estate Pvt Ltd Company Overview

Table 40      Unitech Real Estate Pvt Ltd Financial Overview