Warehousing, data centres are future of commercial real estate: Deepak Parekh

Future demand for commercial real estate in India will come from warehousing, data and fulfillment centres with the rise in ecommerce and the need for new data centres, Housing Development Finance Corp Ltd (HDFC) chairman Deepak Parekh told investors at the company’s 44th annual general meeting (AGM).

Demand for commercial real estate will support the demand for homes which has strengthened due to pandemic, Parekh said.

“Even in terms of commercial real estate most companies have not given up their office premises. With the e-commerce boom, demand for real estate is coming from warehousing and fulfilment needs,” Parekh said.

With the build up of digital infrastructure, demand for data centres has increased, he said.

“There are segments of the real estate sector that have potential to grow immensely,” Parekh said.

He told investors the India economy in on the recovery path and which will undergo the same trajectory it underwent in the last fiscal with second half being more stronger than the first half.

Parekh on Tuesday expressed confidence that the country’s macroeconomic fundamentals are strong and recovery is underway.

“I remain confident that India’s macroeconomic fundamentals are strong. Recovery is underway,” Parekh told investors.

India’s forex reserves, strong foreign direct investment inflows, buoyant capital markets are and strong agriculture growth, RBI’s supporting measures and reforms by the government all point to an economic turnaround, Parekh said.

“The key laggard remains overall credit growth which continues to remain tepid,” he said, while acknowledging that in terms of the overall macroeconomic environment, the key challenge, remains the unpredictability of coronavirus.

“The world is still susceptible to recurring waves of infections. Thus, economic recovery will remain uneven and patchy,” Parekh said.