Surging land acquisitions across India to fuel massive investment in development

India’s real estate sector is witnessing robust growth, driven by large-scale investments in land acquisition to meet rising demand for residential, commercial, and mixed-use developments. A JLL India study highlights a capital investment of Rs. 62,328 crore (US$ 7.15 billion) for developing land parcels acquired in the past year. Developers secured 2,335 acres across 23 cities through 134 transactions, potentially yielding 194 million sq. ft of real estate projects. With 81% of the acquired land earmarked for residential projects, approximately 158 million sq. ft of new housing developments are expected, catering to the growing demand. The Reserve Bank of India’s policy rate cut and fiscal incentives for the middle class are expected to sustain demand, according to Samantak Das, Chief Economist and Head of Research and REIS, India, JLL.   

The top seven metropolitan cities account for 91% of the projected capital requirement, with 1,673 acres acquired in these prime urban centres. The continued expansion of metro networks, expressways, and commercial corridors has further driven land banking, leading to a rise in per-acre land costs from Rs. 11 crore (US$ 1.26 million) in 2022 to Rs. 17 crore (US$ 1.95 million) in 2024. Senior MD & Head of Capital Markets, India, JLL, Ms. Lata Pillai, noted that these acquisitions create opportunities for Alternative Investment Funds and private credit, given regulatory constraints on traditional funding. The post-COVID-19 resurgence has made 2024 a standout year for office and residential real estate, as developers strategically invest in land banks to sustain long-term growth. 

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.