Over 75% real estate projects non-starters: Assocham study
Over 2,300 projects in the realty sector remained non-starters and over 1,000 on-going projects have registered significant delays in completion
New Delhi: Over 75% of the 3,540 live real estate projects with outstanding investments of more than Rs.14 trillion remained non-starters as of 2014-15, a study by The Associated Chambers of Commerce of India (Assocham) said. “Over 75% of the total 3,540 live projects with total outstanding investments worth over Rs.14 trillion attracted by the real estate sector across India remained non-starters as of financial year 2014-15,” said the study. Furthermore, while over 2,300 projects in the realty sector remained non-starters, over 1,000 on-going projects have registered significant delays in completion, the study added.
With 964 projects, the domestic private sector accounted for 95% share in projects facing delays, followed by the public sector (49 projects) and foreign private companies (six projects), it said. “On an average, real estate projects in India are facing a delay of 33 months in completion,” Assocham secretary general D.S. Rawat said while releasing the report. According to the study, realty projects in Andhra Pradesh are facing maximum delay of about 45 months followed by Madhya Pradesh (41 months), Telangana (40 months) and Punjab (38 months). It said that Maharashtra alone accounts for over one-fifth share (21%) in the total outstanding investments attracted by real estate sector, followed by Uttar Pradesh (14%), Gujarat (13%), Karnataka (12%) and Haryana (8%). Tamil Nadu and Telangana accounted for over 6% share each in terms of total outstanding investments garnered by realty sector in the country.
Assam, Bihar, Chhattisgarh, Himachal Pradesh, Jammu and Kashmir, Jharkhand, Odisha and Uttarakhand together accounted for negligible share of less than even 2% in the total outstanding investments attracted by the sector. Kerala recorded highest compounded annual growth rate (CAGR) of about 59% in attracting real estate investments between 2005-06 and 2014-15 followed by Karnataka (40%) and Uttar Pradesh (32%), it said.
Growth in the real estate investments attracted by Haryana declined by over 5% during this period, while West Bengal registered about 4% fall in growth, followed by Madhya Pradesh (3%), it added.