Real estate adds over Rs1 lakh crore to Delhi's GDP in 2010-11

Real estate services added over Rs1 lakh crore to Delhi's GDP of Rs2.58 lakh crore in 2010-11, emerging as top contributors to the city's economy and reflecting the rapid growth and buoyancy in the sector.

The real estate sector, which includes property brokers, home buyers, land owners, property owners and housing finance institutions, contributed 39.69% to the gross state domestic product (GSDP) of the city at current prices, according to latest Delhi Government statistics.

The contribution of the sector has gone up to Rs 1.02 lakh crore in 2010-11 compared to Rs 35,885 crore in 2004-05, registering annual compound growth of 19.16% in the last six years.

According to global real estate consultant Jones Lang LaSalle, the sector will witness further growth with most companies operating in the city firming up expansion plans or executing real estate growth plans with upswing in the economy.

Reflecting the buoyancy in the sector, it said overall Delhi and National Capital Region witnessed a net absorption of 1.63 million sq ft of property space (151,755 square metre) in first quarter of the year.

The significant performance by the sector has largely been attributed to increased demand for commercial property by companies for office space and business activities leading to robust rental growth.

"The sector has potential to grow further provided the city government and the Centre relax certain norms for use of land for property development," said Pradeep Jain, chairman of Confederation of Real Estate Developers' Association of India (CREDAI).

As per Delhi government data, the contribution of the tertiary sector comprising hotels, restaurants, banking, insurance, legal services, real estate at current prices was Rs2.12 lakh crore in 2010-11, which is 82.27% of the GSDP.

In 2010-11, the contribution to GSDP by hotels and restaurants and related trade was estimated at Rs48,413 crore, which was around 18.71% of the total GSDP of the city.

 According to figures, share of primary sector comprising agriculture, livestock and forestry to GSDP in the the year 2009-10 and 2010-11 has decreased by 0.72% and 0.61% at current prices.

Further, the contribution of secondary sector comprising manufacturing and construction has decreased from 18.45 per cent during the base year 2004-05 to 17.44% and 17.11% in 2009-10 and 2010-11 respectively.

At Rs 2.58 lakh crore, the gross state domestic product of the city went up by an impressive 10.53%, increasing from 10.28% in the previous fiscal. Delhi's GSDP in the year 2009-10 was Rs2.18 lakh crore.