India has moved up in JLL and LaSalle Investment Management’s Global Real Estate Transparency Index (GRETI) 2016 driven by Modi government’s focus to boost growth and reducing regulatory hurdles.
“Improved market fundamentals, policy reforms like Land Acquisition Act, liberalisation of foreign direct investment (FDI) into the realty sector, and strengthening of information in public domain along with digitisation of land records and opening up of real estate investment trusts (REITs) were main influencers in the India ranking,” Anuj Puri chairman & country Head, JLL India said. It further added that implementation of the Real Estate Bill and removing procedural bottlenecks in REITs would pave the way for further improvement in the ranking.
Tier-I and Tier-II Indian cities have something to cheer about as the study suggested that these cities have the potential to break into the ‘Transparent’ set of countries from their current status of being ‘Semi-Transparent’ markets. Tier-I cities in India ranked 36th in transparency levels, followed by tier II and III (cities) at 39th and 52nd positions, respectively.
“Out of 109 countries, the top-10 that are identified as ‘Highly Transparent’ alone account for 75% of global investment into commercial real estate, highlighting the extent to which transparency drives real estate investment decisions. The top-10 countries are followed by 20 ‘Transparent’, 37 ‘Semi-Transparent’, 21 ‘Low Transparency’ and 21 ‘Opaque’ countries. While India has a long way to get into the ultimate tier of ‘Highly Transparent’ markets, its tier-1 cities look poised to break into the ‘Transparent’ set of countries from their current status of being ‘Semi-Transparent’ markets. This bodes well for the economy and investment scenario,” the study further added.
The study further added India’s ranking could improve in the 2016-18 assessment period of JLL’s next Transparency Index release on the account of enactment of the Real Estate (Regulation and Development) Act and setting up of a real estate regulator in 2017.
The Index which measures 139 parameters to arrive at a composite score for relative transparency levels has found a strong direct correlation between investment flows and transparency levels as data quality through technology as an enabler, governance and regulatory reforms – essential parameters that investors are evaluating when looking at potential investment avenues.
Credits Financial Express