Real estate developers focused on the supply pipeline by investing in acquisition of land across the country in CY2023. A total of 1,947 acres of land valued at ₹32,203 crore in 111 separate deals was acquired in 2023 as compared to 1,603 acres in 2022 valued at ₹18,112 crore, up by 21% Year-on-Year (Y-o-Y). The land acquired has a development potential of around 176 million sq. ft, a new report by JLL has said.
The residential segment led the way in land transactions locked in the year 2023, it said.
Going forward in 2024, land transactions are expected to remain steady with developers expanding their land banks on the back of expected moderation in interest rates, growing demand for housing and support from institutional funding agencies. Infrastructure changes, specially enhanced metro connectivity between various micro-markets, will throw up new pockets of growth within each city.
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The average transacted value of land has touched ₹16.5 crore per acre in 2023, up by 46% as compared to the previous year. This increase can be attributed to higher land transactions in Tier 1 cities and established prime micro markets, the report said.
In addition, Mumbai Metropolitan Region (MMR), the most expensive real estate market in the country doubled its share in total land area transacted in India from 7% in 2022 to 15% in 2023 and contributed significantly to this increase in per acre transacted value.
Tier 1 cities accounted for 65% of the total land transacted
Tier 1 cities accounted for 65% of the total land transacted in the country. Developers are strategically acquiring land in both prime locations in the metro cities as well as entering new markets and pockets of growth.
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In 2023, Delhi NCR led both in terms of number and area of land deals, with 415 acres acquired across 36 separate transactions valued at approximately ₹9,120 crore. Select established players acquired multiple land parcels across Delhi NCR. Out of these 415 acres, around 264 acres (64%) valued over ₹5,300 crore was acquired in Gurugaon alone. This was followed by Noida with over 59 acres (14%) land being acquired valued at around ₹1,775 crore. Delhi, Faridabad and Sonipat contributed the rest.
Bengaluru followed Delhi NCR, with close to 305 acres of land acquisitions across 14 separate transactions valued at ₹3,412 crore.
MMR saw 24 separate land deals spread over 289 acres valued at ₹11,222 crore – the highest in the country. This translates into an average transacted value of ₹39 crore per acre, which is 2.3 X of the average pan India land value.
In Chennai, a total of 209 acres of land was acquired valued at ₹1,220 crore across eight separate deals, the report said.
Other cities like Nagpur, Ludhiana, Ahmedabad, and Ayodhya experienced prominent developers acquiring land. Ludhiana led in terms of area acquired in Tier 2 and 3 cities with around 320 acres of land transacted, the report said.
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“With a surge in demand for housing, developers are actively acquiring land parcels for building future supply pipelines. Out of the 1,947 acres acquired in 2023, 1,365 acres (~70%) was acquired for proposed residential projects with a development potential of around 130 million sq. ft. The launches of new residential projects are expected to strengthen further through new land acquisitions in strategic locations and growth corridors,” said Samantak Das, Chief Economist and Head of Research and REIS, India, JLL.
Highest ever annual sales of 271,800 units were recorded in 2023, surpassing the peak seen in 2010 at 216,700 units, by 25%. Residential launches in 2023 witnessed a growth of 19% Y-o-Y, the report added.
Also Read: Real Estate Update: Housing sales up 26%; 2.71 lakh units sold across top seven cities in 2023
