Gurugram-3.0: Set to grow at a CAGR of 10-11% in 2024, Commercial to drive Home Segment

Gurugram: The real-estate sector, the second largest employment generator, is booming once again. The sector has fully recovered from the COVID slow-down and is in full momentum. Looking at a growth rate of 10-11% in 2024, the sector is looking forward to a contribution of 13% in India’s GDP in the coming couple of years and all set to support government’s vision of being the 3rd largest economy in the world in the next five years.  

The industry reports are also suggesting robust growth in realty sector in 2024. According to the Knight Frank India Real Estate Report 2023, residential sales are projected to grow by 810%, totalling approximately 3.5 lakh units. The report further indicates an expected rise of 5-7% in average residential prices across major cities, underlining sustained demand. The CBRE India Real Estate Market Outlook 2024 predicts a 15-20% growth in new residential launches, emphasizing improved market sentiment and robust demand.

Interestingly, Gurugram has developed as one of the top cities in demand for investors in commercial and residential segment.  As of 2023, Gurugram has emerged as India’s real estate leader, registering a remarkable 28% quarter-on-quarter growth, far exceeding the national average of 10.4%. A proposed 1000-acre Haryana government’s Global City Project in Sector 36 and 37D in Gurugram, and by 2024, Dwarka Expressway becoming fully operational, the property prices have already started escalating. The healthy competition has put investors and developers in a win-win situation.

With a stable government at the Centre, ease of doing business, robust infrastructure of roads, and close proximity to International airport; many national and multinational giants have chosen Gurugram as their preferred city to open their offices. The incorporation of RERA has given much needed impetus and confidence to investors in India and has promoted FDIs.

Gurugram has seen a transformational change - its shift from residential to commercial segment has been like phases of tips and turns.

Almost 2 decades ago, as we call it the first-phase of growth, when Gurugram was known as Gurgaon, residential segment was struggling to get investors. The isolated locations and distance from Delhi was enough to discourage investment in residential segment, and it also took its toll on investment in commercial segment.  Two factors worked miracles for Gurugram’s growth – (1) the tremendous growth in infrastructure and highways that impacted the travel time from Delhi and (2) Delhi’s exorbitantly increasing property prices, both for rentals and purchasing. These two factors compelled investors to start looking for alternatives, and more than NOIDA, Gurugram became their first choice.

Gradually, many large prominent national and international brands have established their offices in Gurugram. Companies Microsoft, Google, HP, WIPRO, NOKIA, Bharti Airtel, Genpact, Dell, Infosys, American Express, Samsung, Accenture, Snapdeal, Grofers to name a few, and prominent national and international conglomerates, have occupied substantial space in Gurugram. This last decade could perhaps be called as the second-phase of growth and expansion for Gurugram.

Recognized as a millennials city, Gurugram has already started showing signs of its 3.0 expansion with large developers expediting launching and completion of their projects on Dwarka expressway and other parts of the city. The only difference is that almost all projects by prominent developers are focused on mixed-use, with both commercial and residential segment at one location.

It would not be wrong to say that offices of national and multinational brands and conglomerates are emerging as one of the primary reasons for encouraging people to buy property in Gurugram and use them either for high rentals or high investment returns, or for self-occupancy. Safely, the growth in commercial segment is exponentially promoting growth in residential segment.

M3M, the largest developer in Gurugram with more than 50 projects, 3000 acre of land parcels and renowned for its timely delivery, is leaving no stone unturned to capitalize on the current opportunities. In sector 113 and 111 in Gurugram, the Company is building multiple projects. A mega shopping arcade – M3M Capital Walk, with a projected 1000 metres wide frontage, is already driving retail investors. The Company is also developing uber-luxury residential projects - M3M Capital and M3M Crown.

In the first half of FY24, M3M India delivered two residential projects - M3M Heights and M3M Flora68, and one commercial project M3M Skylofts, comprising about 2.5 million square feet space with a construction cost of Rs. 1250 crore. And in the second half of FY 24’, the Company is all set to deliver 3 more projects – M3M Atrium57, M3M Solitude and M3M Lofts74, comprising about 4.0 million square feet space with a construction cost of Rs. 2000 crore. This financial year itself, M3M is set to deliver six projects with 6.5 million square feet space with construction cost of Rs. 3250 crore.

A commercial and retail hub DLF Cyber City on one side and M3M IFC, M3M Urbana Business Park, WorldMark, M3M 65thAvenue on the other side have already become popular for NCR crowd.

DLF is predominantly driven by two launches in Gurugram - one in Southern Peripheral Road (SPR) and the other in Golf Course Road. Realty firm Godrej Properties will soon launch a luxury housing project in Gurugram with an estimated revenue potential of around Rs 3,000 crore. The company will develop nearly 750 apartments in a 9.5-acre housing project 'Godrej Aristocrat' located at Sector-49 in Gurugram.

Other builders like Emaar, Omaxe, Vatika, Adani, ELAN Group, Ashiana Housing, Tata Housing, Bestech, ELDECO, ATS Green, etc are other prominent real estate developers, known for changing the landscape and shaping the future of thriving Millennial City of India.

The growth of realty-sector in Gurugram has also generated both blue-collar and white-collar job opportunities. There has been never such a high demand for engineers, construction workers, interior designers, carpenters, construction material like cement, rebars, steel, bricks, marble, granite etc. There is also a boom for the service industry in the region.

The Gurugram-3.0 expansion would get further boost with the Narendra Modi 3.0 vision or term as we may say, aligning with the infrastructure growth in the country, connecting more of India’s remote regions through expressways and highways.