Commercial property was also very scarce. In the large metros such as Delhi and Mumbai, there were very few fully developed commercial complexes and the satellite towns had not yet come into their own.
In the retail sector – or the commercial properties in India, the boom has been just as great. The mortgage rates at 7.5% to 9 % are among the lowest in the world. The satellite towns of Delhi, Mumbai, and other metros have sprung up very quickly, and most developers have bought large tracts of land. These are being built into highly affordable apartments to cater to demands from the young affluent executives. The entry of large corporations into the residential sector has commercial properties in India led to a raising of standards and a more efficient infrastructure.
Until 2002, India had only 3 shopping malls but by 2008 this is expected to rise to over 250. Reliance Industries, India’s largest conglomerate is building over 40,000 retail supermarkets, and as they say it – once they enter the market “it will be a bloodbath out there”for commercial properties in India.
The local developers such as DLF, who in the 1980s bought large chunks of undeveloped land in the outskirts of Delhi in Gurgaon, are now reaping in the harvests of their investments. Gurgaon, after Bangalore, has become India’s second largest technological hub. The return on their capital investment is believed to be between 30% to 50% . By next year – 2007, it is expected that commercial properties in India more 35 million square feet of will be released in the market.Outlook
As is evident, investment in to the commercial property property in India can bring high returns, and will be an investment in the future of one the most rapidly growing economies in the developing world directly influenccing the commercial properties in India
A “ Knight Frank India Research ‘India Property Investment Review Quarter 4 2005′ “
has stated that “Returns from rental income on investment in commercial property in metros is around 10.5%, the highest in the world.
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