Real estate development along national highways generates more than 15% profit: JLL India

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According to real estate consultant JLL India, real estate development along the national highways could generate more than 15% income for builders and potential investors.

It says the government is focused on providing world-class infrastructure and related services to the highway network.

Read also: Increased competition in the road sector could affect contractor profits: ICRA

The consultant said there is a need to develop commercial space, warehouses, logistics parks and travel facilities, including roadside facilities along the highway.

These roadside amenities include restaurants, food courts, retail outlets and electric vehicle charging stations.

“National Highways offer real estate development opportunities across India at 15 percent profit margins,” JLL India said in a statement.

According to the consultant, the National Highway Administration of India (NHAI) has identified more than 650 properties in 22 states with a total area of ​​over 3,000 hectares to be developed with private sector participation over the next five years.

It includes 94 sections on the Delhi-Mumbai Expressway, 376 sections on new motorway / expressways under construction and about 180 sections along the existing highway network in India.

“We anticipate that NHAI will provide impetus to the modernization of the Indian highway network in the coming years, which will ultimately lead to various beneficial effects for highway users, market participants, developers, investors and facility operators,” A. Shankar, Head of Strategic Consulting. & Valuation Advisory, JLL.

He estimated the rise in land prices in these areas and micro markets by 60-80 percent in the short term and 20-25 percent as the facilities are put into operation.

“JLL has been appointed by NHAI as an international property consultant for North and South India. The assignment includes a phased compilation of a short list of existing and new land plots, identification of land monetization options, a detailed feasibility study and financial viability of each plot, “Shankar said.

According to him, out of 650 identified sites, bids have already been announced for 138 sites, and market participants took an active part in the bidding.

“Clear ownership of land, free of encumbrances and pre-approved plots without the need for land use change, as well as an attractive lease option for up to 30 years with flexible project development options will open up new growth opportunities for developers and potential investors,” JLL said.

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