India has reached the "Transparent" tier in JLL's Global Real Estate Transparency Index 2024, marking a milestone in its real estate sector. This advancement is due to improved data access, enhanced institutional practices, and the rise of Real Estate Investment Trusts (REITs). With WELL-certified spaces surpassing 70 million square feet and robust regulatory frameworks like RERA and the Insolvency and Bankruptcy Code, India is now among the top ten markets globally for transaction processes. Despite these gains, further improvements in dispute resolution are needed to sustain transparency and attract continued international investment.
India has made significant strides in the real estate sector by reaching the "Transparent" tier for the first time in JLL's Global Real Estate Transparency Index 2024. This noteworthy achievement reflects a combination of better data access and improved institutional practices within the commercial real estate market. Increased transparency is crucial as it attracts international investment and enhances overall market efficiency.
According to Samantak Das, Chief Economist and Head of Research & REIS at JLL India, the rise in transparency is largely attributed to a growing institutional presence and a commitment to industry best practices. The establishment of Real Estate Investment Trusts (REITs) has particularly contributed to this growth by stabilising commercial assets. Additionally, standardised valuation processes and comprehensive REIT regulations are pivotal in creating a market that operates on transparent and reliable parameters.
The evolving landscape includes a focus on sustainability, with India witnessing an impressive increase in WELL-certified spaces, surpassing 70 million square feet in 2023-up 40% from 2021. This shift signifies a broader commitment to mitigate climate risks and foster environmentally favourable practices in real estate. Regulatory frameworks such as the Real Estate (Regulation and Development) Act (RERA) and the Insolvency and Bankruptcy Code have enhanced investor protection, presenting a strong case for further capital inflows into the sector.
The recent progress places India among the top ten global markets for transaction processes, and its emphasis on data accessibility is paving the way for improved information flow across the real estate spectrum. However, there remains a need for better dispute resolution mechanisms to bolster this momentum and ensure a more efficient real estate environment. Karan Singh Sodi, Senior Managing Director at JLL, noted that while the improvements are significant, collective action is essential to democratise data access and strengthen institutional engagement in public markets.
India's real estate sector is positioning itself to benefit from near-record capital inflows, with USD 4.8 billion recorded in the first half of 2024 alone. As the market evolves, it is vital to sustain the push towards enhanced transparency and accountability. Increased focus on environmental, social, and governance (ESG) criteria, alongside widespread adoption of green leases, will be crucial for elevating India's position on the global transparency scale.
As the industry prepares for a new real estate cycle in 2024, the groundwork laid today will have lasting effects. Transparency, comprehensive data access, and diversification opportunities will potentially lead the market recovery, ensuring that India continues to attract global investors seeking reliable and sustainable investment avenues.
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