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The trend of sustainability in real estate is rapidly growing in India. Many major real estate companies, such as Mahindra Lifespaces, Godrej Properties, DLF, and Macrotech Developers, are looking to incorporate health, wellness, and sustainability into their residential projects to meet the growing demand for green homes. Moreover, the pandemic has heightened the need for people to adopt ESG (environment, social, and governance) principles, and real estate companies are taking advantage of this shift in consumer behaviour.
In the past five years, there has been a significant push towards green buildings, with a 37% rise in the supply of certified buildings, adding 78 million square feet of certified stock since 2016. Realtors who once positioned sustainable housing as a premium offering are now expanding it into the affordable segment. The price difference between conventional residential properties and their sustainable counterparts has narrowed over the years, making it easier for developers to incorporate green building practices and still maintain profitability.
Mahindra Lifespaces, which recently became a unicorn, has committed to developing only net-zero buildings by 2030. The company's FY22 annual report states that four of its projects were certified by the Indian Green Building Council. Mahindra Eden, launched recently in Bengaluru, is India's first net-zero energy residential project, meeting a portion of its electricity needs with energy produced onsite from solar and wind while the remaining is obtained from grid-powered renewable sources.
Research by Godrej Properties shows that the additional cost of a green building ranges from 2% to 8%, depending on the level of certification. Anubhav Gupta, CEO Vikhroli, chief CSR and sustainability officer at Godrej Properties, states that the cost difference between conventional and green buildings has come down to nearly 2% from 20-30% a few years ago. This decrease in cost is due to the integration of sustainable practices into the planning stage, making it easier for developers to incorporate these measures and still maintain profitability.
The younger generation of buyers is becoming increasingly aware of the importance of sustainability in real estate. They are asking for details about the construction materials used, thermal insulation, water and energy conservation measures, and HVAC systems, which is forcing realtors to adopt newer technologies. According to Harsh Bansal, convener of the National Real Estate Development Council, the lack of marketing of sustainable housing solutions and products is a problem, but with increasing consumer awareness, realtors will have no choice but to adopt new technologies.
The trend towards sustainability in real estate is rapidly growing in India. With the growing demand for green homes and the need to adopt ESG principles, major real estate companies are incorporating health, wellness, and sustainability measures into their projects. The cost difference between conventional and green buildings has decreased, making it easier for developers to maintain profitability while incorporating green building practices. The younger generation is becoming increasingly aware of the importance of sustainability, and this is driving the shift towards a more sustainable real estate market in India.
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