A new report by Knight Frank, HDFC Capital, and Brigade REAP highlights PropTech's transformative role in India's real estate sector, projecting investments to grow at a 15% CAGR from USD 6 billion in 2023 to USD 16 billion by 2030. Representing 6% of Indian startups, PropTech positions India 6th globally in funding and top global PropTech deals. With real estate contributing 7.3% to GDP, leaders stress technology's role in addressing housing affordability, urbanization, and sustainability challenges. Infrastructure expansion, such as national highways and ESG-certified developments, complements PropTech adoption, enhancing connectivity, sustainability, and affordable housing access for the growing urban workforce.
Knight Frank, in collaboration with HDFC Capital and Brigade REAP, has published a report that highlights the transformative impact of PropTech on India's real estate industry and its potential to enhance housing affordability. The report predicts that investments in PropTech will grow at an impressive compound annual growth rate (CAGR) of 15%, increasing from USD 6 billion in 2023 to USD 16 billion by 2030. In 2023, PropTech represented 6% of recognized Indian startups, positioning the country as the 6th globally in funding raised and in the top 500 global PropTech deals for 2022-23, following global leaders like the USA and China.
According to Shishir Baijal, Chairman and Managing Director of Knight Frank India, technology is a vital catalyst for development across sectors. He emphasized that the increasing investments in PropTech are revolutionary, supporting both industry growth and sustainability. This aligns with the country's growing need for technology-driven solutions in real estate, particularly in enhancing efficiencies and addressing affordability challenges.
Nirupa Shankar, Joint Managing Director of Brigade Group, noted that the real estate sector contributes 7.3% to India's GDP, with PropTech accounting for USD 6 billion of this value. Rising urban housing demand, driven by the younger workforce, underscores the necessity of strategic infrastructure, innovative technologies, and sustainable practices to create accessible, future-ready housing solutions.
Vipul Roongta, Managing Director and CEO of HDFC Capital, echoed the sentiment, emphasizing technology's role in overcoming supply-side challenges in affordable housing. He highlighted the H@ART Program, initiated by HDFC Capital, which supports real estate tech companies focused on breakthrough innovations. This initiative aims to make affordable housing more accessible and efficient while fostering innovation in the sector.
The real estate sector, valued at USD 258 billion, is a significant contributor to India's USD 3,540 billion GDP. However, with rapid urbanization and escalating property prices, housing affordability remains a pressing concern, particularly for the middle-income group. Infrastructure advancements are key to addressing this issue. Over the last decade, India has expanded its national highway network by 60%, growing from 91,000 km in 2014 to 146,000 km in 2024, with an ambitious target of 185,000 km by 2030. This expansion connects tier-2 cities and suburban areas to employment hubs, boosting the development of affordable housing.
Globally, PropTech has garnered substantial attention, with USD 50 billion in investments in 2023. In India, technologies such as Building Information Modelling (BIM), IoT, and smart home systems are gaining traction, revolutionizing project lifecycles and sustainability. Environmental, Social, and Governance (ESG) principles are integral, supported by certifications like LEED and IGBC. India boasts over 290 million sq. meters of LEED-certified buildings, with Bengaluru, MMR, and NCR leading in sustainable development.
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