Real estate to touch $90 bn by 2015: Assocham

Fuelled by the impressive economic growth, the country's real estate market which is growing at 30 per cent, is likely to touch 90 billion dollar by 2015, a recent report projects.

Though the growth of the realty sector came down in recent times, it would touch $90 billion from the current level of $14 billion and would help the economy continue to grow between 9-10 per cent, according to a recent report by industry body, Assocham.

"While a $10 billion FDI is expected to flow into the sector by 2008, it might reach $15 billion by 2010," Assocham President Venugopal N Dhoot said in a statement.

The additional requirement of 370 million sq ft of space in urban areas by 2010 by IT, ITeS, financial services and organised retail alone has still made the real estate most lucrative sector, providing returns ranging from 20 to 30 per cent, the report said.

Repealing the Urban Land (Ceiling and Regulation) Act 1976, rescind of the Rent Control Act and increasing floor-area-ratio would give further boost to the sector, Dhoot added. According to the chamber report, IT and ITeS, banking and financial services have in particular created a huge demand for office space.

IT and ITeS alone is expected to require 150 million sq ft across urban India by 2010, while services are further expected to clock a double-digit growth in the future, keeping the demand of office space robust.

As per the report, analysts pegged the total demand for commercial office real estate in Bangalore, Chennai, Delhi-NCR, Mumbai, Pune, Hyderabad and Kolkata alone to be over 25 million sq ft in 2006.