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Global real estate consultancy JLL’s project and development services business in India expected to grow by 15-20%
JLL is also planning to focus on the senior living, warehousing and assets advisory business in India, two global CEOs of the company told HT Digital
Global real estate consultancy JLL’s project and development services (PDS) footprint in India has touched 250 million sq ft in FY2023 and is expected to grow at 15-20% this fiscal. While the office sector continues to remain the focus, the company is exploring expansion opportunities in segments such as senior living and warehousing in the country, Cynthia Kantor, CEO, Project and Development Services (PDS) and Susheel Koul, CEO, Work Dynamics, Asia Pacific, Singapore, told HT Digital.
“While JLL’s core business in India is centered around the office segment, it has expanded its presence in the industrial sector and to some degree in retail and hospitality as well. The focus on diversification is the core of our strategy and project businesses around the world. Our focus is a lot on offices and the built environments as both are important to people and the society as a whole,” Kantor told HT Digital during her first visit to India after taking over as the CEO of JLL's PDS business earlier this year.
The global consultancy’s PDS business in India touched 250 mn sq ft in FY 2023 and is expected to grow at the rate of 15-20% this fiscal, she said.
The company is also focusing on the manufacturing, industrial, logistics and e-commerce (MILE) segment around the world. “We have 8000 employees across the world and the MILE businesses are very technically intense. These are our high growth areas globally and we are expecting consistent growth across these segments in the next decade,” she told HT Digital.
On senior living
The company has diversified into education and senior living in Australia and plans to introduce those segments in India as well, said Koul, who was a part of JLL's global leadership team that visited India recently.
Also Read: South Indian states, including Bengaluru, lead with 62% share of the senior living housing segment
“The senior living business is just about a decade old and is maturing. Fast forward 20 years, the growth in wealth and the emerging nuclear family set-up, is expected to propel demand for the senior living business in India as well,” he said.
The company is also targeting the warehousing segment.
“Warehousing is the next big focus area for private equity in India. With the growth in last mile delivery among retailers, infrastructure development across cities, this business is expected to be a major growth area in India,” he said.
JLL's assets advisory business expected to grow by 20-25%
JLL is also planning to focus on its assets advisory business in India.
“Financial institutions pump in money into several real estate projects and require consultants to look into the quality aspects of the project and whether the investments are being deployed in the right manner. This is an area of growth for us,” said Koul.
Also Read: CREDAI pledges 1,000 green buildings by 2025
The company is currently working with banks, who have the funds and a set of developers who need them. “But the money will not be given directly to them. We will act as an intermediary,” said Koul, adding this segment is expected to grow by 20-25% in the next five years.
“This business where we act as asset advisers to banks/ investors, and make sure that their money is put to good use and high quality assets are delivered on time, will form a substantial part of our business in the next five years. We see this segment growing by almost 25% going forward,” he added.
On green buildings
Grade A sustainable office buildings command a 7% to 8% rental premium. “JLL is working on a fairly large sustainable commercial buildings portfolio in India. With several companies around the world pledging to reduce their real estate emissions by half by 2030 and reach net-zero carbon no later than 2050, this segment presents a big opportunity,” said Koul.
The focus is also expected to be on retrofitting Grade B commercial buildings with sustainable features, he said.
The demand for sustainable commercial buildings in India is led by global capability centres, said Kantor.
GCCs or global in-house centers or captives, are offshore units of large multinationals performing technology operations.
Work-from-home and impact on commercial space take-up
With companies asking their employees to return to offices post the pandemic, there is also a need to encourage more people to come to work. “JLL is incorporating artificial intelligence to make office spaces efficient and engaging,” explained Koul.
Also Read: Office buildings in Mumbai’s Bandra Kurla Complex command higher prices than Manhattan
“We have created occupancy maps for several offices around the world. This helps us analyse how people use office space through the day. Through this mechanism we are able to track employee behavior movements on a Monday and how these may change on a Wednesday,” he said.
“This helps us optimize costs and reduce wastage which in turn impacts sustainability,” he added.
