In a rapidly growing economy like India Cheap Chicago Bears Jerseys , the great migration to the cities, growing population, and a swelling middle class are creating a desperate need for more urban real estate. In the past few years, demand for private capital for commercial real estate investment and supporting infrastructure has increased immensely. In the years to come Riley Ridley Bears Jersey , the commercial real estate investment industry will find itself at the epi center of rapid economic and social growth, which is already transforming the environment.
Here are 4 key insights about the future of Indian commercial real estate by the year 2020:
1. Massive expansion of cities due to migration By 2020, the 21st century鈥檚 great migration to the cities will be well underway. Tier 1 and 2 cities will be swelling with immigrant manpower from lesser urban regions. Fast-growing cities such as Pune and Bengaluru will be at the crux of the commercial real estate revolution. Even developed cities like Mumbai will be urbanizing, albeit at a slower pace. The volume of building activity will be huge David Montgomery Bears Jersey , expanding the country鈥檚 inventory of institutional-grade real estate. Global construction output is expected to almost double to US$15 trillion by 2025, up from US$8.7 trillion in 2012. Emerging markets in Asia will be the fastest-growing region. Alternatively, the emergence of technology might change the trend of migration. There is a huge opportunity for the warehousing industry to tap into the rural agricultural market thereby reducing the pressure on the urban cities. The reduced migration will also lead to change in construction practice with more mechanization to achieve standardization and faster production.
2. Changes in population demographics will drive changes in demand for commercial real estate
Demographic shifts will affect demand for commercial real estate fundamentally. The burgeoning middle-class urban populations in India will need far more workplaces. Meanwhile, the country鈥檚 aging populations will demand specialist types of real estate Akiem Hicks Bears Jersey , while their requirements for workspaces will moderate. Smart Cities will attract the young middle classes, especially in emerging markets like Vizag and Coimbatore. As intense competition for space increases urban density, office sizes are likely to shrink. Developers will need to become more innovative about how they use space. Population growth and aging will lead to several real estate subsectors emerging. While office, industrial and retail will remain the main sectors Tarik Cohen Bears Jersey , affordable health care and retirement will become significant subsectors. We will witness vertical rise in most cities since the dense urbanization will always put pressure on the infrastructure of growing cities. With urbanization moving at geometric proportion while infrastructure getting incremented in arithmetic pace there would be a realignment to move towards increasingly vertical cities.
3. Emerging markets鈥?growth notches up competition for assets Real estate has played a large part in driving economic growth in India. Even as growth moderates in many saturated markets such as Mumbai and Delhi, the pace of construction activity remains rapid, increasing investment opportunities. By 2025, over 60% of all construction activity is forecasted to take place in emerging markets Mitchell Trubisky Bears Jersey , up from just 35% in 2005. The growth of emerging countries like India is rapidly creating powerful new real estate players and new asset managers. Thus, there is both rising competition for commercial real estate assets and budding competition within real estate asset management.
4. 鈥楽ustainability鈥?dictates design principles of commercial buildings By 2020, it鈥檚 likely that buildings will need to have sustainability ratings. What鈥檚 more? The concept of sustainability will have widened to mean creating 鈥榩laces鈥?where people relish living and working. To meet this new requirement new developments will be designed with green spaces, better air quality Anthony Miller Bears Jersey , spaces for social gathering and so on. Already, developers are integrating sustainability features into commercial buildings, office spaces, malls Roquan Smith Bears Jersey , and even new cities.
d gears and accepted fresh challenges. The growing need for commercial real estate across cities has led to increased investment in the sector. The growing flow of FDI into Indian real estate is encouraging increased transparency. Developers Khalil Mack Bears Jersey , to attract funding, have revamped their accounting and management systems to meet due diligence standards. These measures indicate a spell of prosperity on the overall CRE market in India.
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