Religious tourism is spurring real estate growth in India's pilgrim towns

Record tourist influx and government investments drive property prices up in temple cities

The pilgrim towns of India have caught the attention of developers. The real estate boom extends beyond Ayodhya, where the Ram temple was inaugurated in January. Religious hubs like Tirupati, Shirdi, Amritsar, Varanasi, Vrindavan, Dharamshala, and Haridwar are also attracting realtors.

According to the tourism ministry, India’s religious tourism sector saw 1,439 million tourists in 2022 and is expected to grow at a 16 per cent compound annual growth rate (CAGR) by 2030. The sector is projected to generate $59 billion in revenue by 2028 and create 140 million temporary and permanent jobs by 2030.

Real estate consultant Anarock noted a spike in property prices by about 25-30 per cent post the Supreme Court verdict on the Ram temple site in 2019. On the outskirts of Ayodhya, they rose from Rs 400-700 per sq ft, while within city limits, prices increased to Rs 1,000-2,000 per sq ft. By October 2023, the market saw further growth with average land prices on the outskirts escalating to Rs 1,500-3,000 per sq ft, and within city limits rising to Rs 4,000-6,000 per sq ft.

“In a country like India, religious destinations attract considerable interest from end-users and investors,” said Anuj Puri, chairman of Anarock Group.

The House of Abhinandan Lodha said it “strategically emphasises” luxury developments in spiritual locales, recognising their cultural significance and potential as global cultural hubs. It has so far acquired 2.2 million sq ft of land in Ayodhya.

“Our Ayodhya project aligns with the city’s developmental agenda, reflecting significant government investments and proactive investor engagement,” said Abhinandan Lodha, chairman and founder of House of Abhinandan Lodha. “The boom in infrastructure, hospitality, healthcare, mobility, public transport, commercial districts, entertainment hubs, and allied industries will increase demand for land, yield higher rentals, and expand city limits.”

At its Ayodhya project, about 24 per cent of the interest came from non-resident Indians (NRIs) across 14 countries, primarily from West Asia and the United States. About 22 per cent of interest came from the Uttar Pradesh towns of Lucknow, Kanpur, and Meerut, while 35 per cent was from Delhi-National Capital Region. The remaining came from various locations in India.

“Our goal is to achieve a cumulative annual booking value of Rs 9,100 crore in the next three years,” said Lodha. “We plan to enter 15 new geographies across India over the next two years and are developing projects in Shimla, Lucknow, Vrindavan, Mathura, Dwarka, and Amritsar.”

Earlier this year, Bollywood veteran Amitabh Bachchan bought a plot in the House of Abhinandan Lodha project, Sarayu, in Ayodhya for an estimated Rs 14.5 crore. “The partnership highlights the strategic investments and infrastructural development driving the city’s economic growth,” said Lodha.

In Tirupati, Andhra Pradesh, Delhi-based realtor Anant Raj’s project aims to “enhance the living conditions of factory workers”. The company’s goal is to provide housing for the local industrial workforce and religious visitors.

“Cities with religious significance such as Tirupati and Ayodhya hold immense potential for future development,” said Aman Sarin, director and chief executive officer of Anant Raj. “Given its scarcity and rapidly increasing prices, developers are pursuing opportunities to acquire land in these cities on a large scale.”

Anant Raj’s Tirupati project spans about 10 lakh sq ft. “We are developing nearly 1,900 apartments with 2 BHK configurations, priced at less than Rs 20 lakh each,” said Sarin. “Scheduled for completion by 2027, the project will feature a ground-plus-seven structure, providing housing for the local industrial population and religious visitors.”

Noida-based Assotech Group believes India’s real estate growth story lies in the success of tier-2 cities. 

“In the next 10 years, cities with religious and cultural settings will attract similar attention and development,” said Assotech Managing Director Sanjeev Srivastva. “Real estate companies must bring international-quality lifestyles and integrated amenities to these cities. They have the potential to attract international Indian diaspora and tourists.” Assotech, he added, is looking at cities like Ayodhya and Deoghar in Jharkhand to expand its footprint. 

Omaxe Group has also initiated residential and commercial projects in religious cities. “As developers, we recognise the immense potential in these cities and have strategically bought land parcels there to develop transformative projects that resonate with the spiritual essence of these revered destinations,” said Mohit Goel, MD, Omaxe Group.