Virtual Session on Alternative Funding Options for Real Estate Sector 2.0

Virtual Session on Alternative Funding Options for Real Estate Sector 2.0
Commercial Real Estate

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Greetings from Resurgent India!

Real estate sector is one of the most globally recognized sectors. It comprises of four sub sectors – housing, retail, hospitality, and commercial. The growth of this sector is well complemented by the growth in the corporate environment and the demand for office space as well as urban and semi-urban accommodations. The construction industry ranks third among the 14 major sectors in terms of direct, indirect and induced effects in all sectors of the economy.

In India, the real estate sector is the second-highest employment generator, after the agriculture sector. It is also expected that this sector will incur more non-resident Indian (NRI) investment, both in the short term and the long term. Bengaluru is expected to be the most favoured property investment destination for NRIs, followed by Ahmedabad, Pune, Chennai, Goa, Delhi and Dehradun.

By 2040, real estate market will grow to Rs. 65,000 crore (US$ 9.30 billion) from Rs. 12,000 crore (US$ 1.72 billion) in 2019. Real estate sector in India is expected to reach a market size of US$ 1 trillion by 2030 from US$ 120 billion in 2017 and contribute 13% to the countryā€™s GDP by 2025. Retail, hospitality, and commercial real estate are also growing significantly, providing the much-needed infrastructure for India’s growing needs.

The office market in top eight cities recorded transactions of 22.2 msf from July 2020 to December 2020, whereas new completions were recorded at 17.2 msf in the same period. In terms of share of sectoral occupiers, Information Technology (IT/ITeS) sector dominated with a 41% share in second half of 2020, followed by BSFI and Manufacturing sectors with 16% each, while Other Services and Co-working sectors recorded 17% and 10%, respectively.

The prolonged pandemic has exacerbated the liquidity crunch in the real estate sector, making it difficult for developers to get construction finance. Banks have set stringent conditions for real estate lending and some non-banking financial companies (NBFCs) are lending selectively. Construction funding is crucial for developers to start projects and for working capital requirements, which amounts to about 50% of the project cost. Developers, typically, rely heavily on banks and NBFCs for debt. The delay in under-construction residential projects has made it tougher for them to procure funding, particularly for mid-sized and small developers.

Most bankers want to lend only to high-rated corporates with a good parental backing. Lenders are also not keen on providing fresh credit to everyone, as the Reserve Bank of India has projected historic highs in terms of bad loans. The focus of the banking sector has now moved to retail loans, especially in housing, where the risk is low and volumes are high.

The mission of this conference is to highlight the alternative funding options for Real Estate 2.0, identify strategies and solutions to fast-track project execution, discuss the key issues and potential solutions, and showcase the most noteworthy projects and promising technologies. The conference will also provide a platform to industry players, policymakers, investors, consultants and technology providers to share their experience and exchange ideas.

Programme Agenda

Time: 4 PM to 5 PM

Key discussion points:

šŸ‘‰šŸ» Funding opportunities in India
šŸ‘‰šŸ» Alternative Investment Fund
šŸ‘‰šŸ» Last Mile Funding
šŸ‘‰šŸ» Funding options through project life cycle


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