The real estate sector in India has witnessed unprecedented growth in land deals during 2023, with a focus on diverse developments across the country. According to ANAROCK Research, the surge in residential real estate and warehousing demand has led to a 50% annual increase in land transactions, exceeding 2,300 acres. Key highlights include record-breaking deals by the Wadia Group and Godrej Properties, the largest land deal in Mumbai, and Foxconn's acquisition of 300 acres in Bengaluru. The Mumbai Metropolitan Region dominates with 30% of total transactions, followed by the National Capital Region.
The year 2023 has proven to be a mind blowing period for land deals in India, particularly in the real estate sector. The industry has witnessed remarkable growth, with real estate developers and businesses engaging in record-breaking land acquisitions across various cities. According to a research report by ANAROCK, the post-Covid focus on land acquisition by real estate developers remains strong, targeting prime land parcels throughout the country for diverse developments and shows no signs of slowing down. Some land deals this year reached staggering prices of around Rs 100 crore per acre.
Up until September, there have been 75 land deals covering over 2,310 acres, with September alone witnessing the closure of 16 new deals spanning over 292 acres, as reported by ANAROCK Research. The surge in residential real estate and the demand for warehousing space have driven a 50% annual increase in land transactions, surpassing 2,300 acres in volume. The report also reveals that over 87 land deals for 1,862 acres were closed in the previous fiscal year (2022-23) across India.
Some noteworthy land deals in 2023 include the Wadia Group's sale of a 22-acre land parcel at Wadia International Centre in Worli, Mumbai, to Goisu Realty Private Ltd, a subsidiary of Sumitomo Corporation, for Rs 5,200 crore— recording the largest land deal in Mumbai's real estate market. The shares of Wadia Group's textile giant Bombay Dyeing and Manufacturing Company (BMDC) jumped more than 15% after this colossal land deal.
Godrej Properties also made significant acquisitions, securing two plots in Gurugram for approximately Rs 900 crore to develop luxury housing projects, targeting a sales revenue of Rs 3,100 crore post-development. The two plots are located on Golf Course Road micro market and spread over 2.76 acres and 5.15 acres. The company has been aggressively acquiring land across major cities over the past two years with the aim to acquire land parcels that can help generate revenue of Rs 15,000 crore. Godrej Properties has been one of the largest land acquirers over the last couple of years. In FY23 it acquired over 18 land parcels with a total saleable area of more than 2.9 crore square feet.
In Telangana, Hyderabad- based Rajapushpa Properties Private Ltd secured a 3.60-acre plot for the highest bid of Rs 362.70 crore, marking the state's largest land deal. The Hyderabad Metropolitan Development Authority conducted an e-auction at the Neopolis layout of seven prime open plots spread over 45.33 acres at Kokapet on the outskirts of Hyderabad on which fetched the huge revenue to the Telangana government, with this plot being sold out for around a whopping Rs. 100 crore per acre.
Furthermore, in Ahmedabad, a plot set a new record by fetching Rs 3.4 lakh per square yard, totalling Rs 153 crore. This unprecedented deal occurred after a substantial increase in the annual statement of rates (ASR) in Gujarat in April 2023, leading to an 84% spike in property transactions for the fiscal year 2022-23.
A significant majority of land deals, totalling over 72%, are dedicated to residential purposes, encompassing high rises, plotted developments, and townships. Some notable exceptions include a handful of deals designated for commercial projects, including four separate transactions for a hotel project, an industrial park, an IT park and a substantial 300-acre deal in Bengaluru intended for a manufacturing project by Foxconn.
Taiwanese contract manufacturer Foxconn, one of the largest producers of Apple products, acquired 300 acres in Devanahalli, Bengaluru, for Rs 300 crore through its subsidiary Foxconn Hon Hai Technology India Mega Development.
In terms of geographical distribution, the Mumbai Metropolitan Region, currently experiencing major construction activity and a high demand for housing, claimed the highest share of land deals at 30% of the nation's total transactions. Following closely was the National Capital Region, although the deal sizes in these regions tended to be comparatively smaller.
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