Sale of commercial spaces falls

Residential projects have attracted huge investments across the country in recent years, but many commercial plots in major cities are lying vacant due to a dearth of buyer interest, according to construction industry body Construction Real Estate Developers of India (CREDAI).

"While 12 million square feet is lying idle in Chennai, it will be more across the country. Many areas in Hyderabad, Bangalore and Gurgaon are lying vacant in commercial spaces," CREDAI National Vice-president Prakash Challa said.

Noting the real estate industry saw a slowdown after the sub-prime crisis in the US, he charged the Centre with not taking any steps to revive the industry.

"If they had taken steps immediately after the crash of the US market, the sector would not have faced this much of a problem... All developers and agencies would have been cautious," Challa said.

Asked whether there was any positive impact from the government's intervention after the global economic crisis erupted in 2008, he said: "There are no good developments still in the commercial space front. Only limited investments are coming up."

"If the government extends the stimulus package, it will generate employment. But if they withdraw it, then there will be a serious problem. Today, many buildings are sitting idle and every builder has become cautious... They don't want to commit themselves (by investments in commercial spaces)," Challa added.

He said the situation is expected to improve over the next one or two years.

Challa said Tier-II and III cities were the worst-hit, with no major developments in the commercial spaces sector.