Realtors to capitalise on poor infra in education sector

Lack of physical infrastructure in the education sector, which has become a key focus area for the government, provides huge opportunities for real estate players, says a survey by real estate research firm DTZ

“The quantum of physical infrastructure and real estate development required to address the aspiration of GER (gross enrolment ratio) enrolment is a Herculean task and cannot be achieved by government or education institute operators alone.

“This provides significant opportunities for real estate developers for creating physical infrastructure in the education landscape,” DTZ India co-head for investment advisory Anuj Nangpal said in a survey.

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With a population of around 1.2 billion and over 144 million potential customers for higher education, the country is now ranked amongst the largest markets globally, the report says, adding, there are around 25,000 colleges and 460 universities.

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According to the survey, nearly 5,550 million sq ft of real estate demand would arise from the higher education sector to achieve a GER ratio of 30 per cent by 2020. This includes development of educational institutes and support services like hostels, retail space, etc.

At present, the GER in the country is at a low 12 per cent, which is less than half global average of 26 per cent.

“In addition to education institutes, the education landscape also provides significant opportunities for developing ancillary support services and thereby providing additional revenue generations avenues for a realty players,” he said.

Additional revenues can be generated by providing amenities like hostels and staff-housing, recreation facilities and play areas apart from retail and entertainment space, Nangpal said.

“The education sector provides realtors with an opportunity to diversify into non-core business which is largely insulated from economic performance of the marketplace,” he said.

Developers, including Prestige Group, Mantri Developers, MCN Group and Salapuria Developers, among others, have already ventured into higher education sector in the recent past, the report said.

Further, the higher education sector, which is poised for an inflection point, is expected to grow at an accelerated pace in the near future, and is anticipated to stimulate overall growth of real estate over the next decade more particularly in small towns, he said.

PTI