Indian Construction Costs A Biannual Review - July 2020 - Gleeds

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Indian Construction Costs A Biannual Review - July 2020 - Gleeds
Indian Construction Costs - A Biannual Review - July 2020

                        Indian
            Construction Costs
             A Biannual Review
                                          July 2020

July 2020                                                                  1
Indian Construction Costs A Biannual Review - July 2020 - Gleeds
Indian Construction Costs - A Biannual Review - July 2020

            Note from the Managing Director

            The construction industry in India had benefitted from sustained growth in 2018 and 2019.
            Growth forecasts were equally good for 2020 and beyond, however, the onset and spread of
            the Covid-19, declared as a pandemic in January 2020, has forced all industries to rebalance
            themselves to remain commercially viable in the new evolving world. It is, however, important
            to reflect on what the industry looked like and analyse the way forward in the given situation.
            Distorted material supply, the reorganising of supply chains and the migrant labour exodus who
            will eventually return to construction sites post-monsoon / festive seasons have an impact on
            costs of construction as we know it. Newer technologies such as virtual construction, virtual
            reality, IoT sensors, prefabrication, touch-free controls are expected to take major strides in
            the near future.

            To cast more light on the industry trends, I am delighted to introduce a new biannual
            publication of Gleeds India which provides real estate professionals a catalogue for mapping
            Indian construction costs. This publication walks the reader through the overview of the Indian
            economy, insights on pre-Covid-19 material and labour cost trends and Gleeds’ insights on
            the various construction sectors’ cost outlook. There is also a reflection on the current market
            trends of the sectors and where they are likely to be post the Covid-19 situation.

            Whilst the change as a consequence of the pandemic is global, the ‘constant’ change
            for Gleeds India has been the zeal to upskill our knowledge base and assist in upscaling
            the industry. The full impact of Covid-19 on projects, design and cost are yet to be fully
            established. However, Gleeds India will be closely monitoring its effect on all aspects of the
            construction cost, time and process in the months to come which would allow our clients to
            make informed decisions.

            I sincerely hope that this publication will be insightful and adds value to your outlook of the
            industry in the present times.

            Ben Huskisson, MRICS.
            Managing Director

July 2020                                                                                                                        2
Indian Construction Costs A Biannual Review - July 2020 - Gleeds
Indian Construction Costs - A Biannual Review - July 2020

            Contents

            04   Economic Outlook
                                       20   H1 2020 Construction
                                            Costs: Sector wise

            08   Key Price Trends
                                       24   City Cost Indices

            11   Material Prices
                                       26   Industry Transformation

            13   Labour Rate Trends
                                       28   Look Ahead

            16   Construction Sector
                 Outlook               30   References

July 2020                                                                                          3
Indian Construction Costs A Biannual Review - July 2020 - Gleeds
Indian Construction Costs - A Biannual Review - July 2020

            Economic Outlook

                                       The Den Hotel, Bangalore

July 2020                                                              4
Indian Construction Costs A Biannual Review - July 2020 - Gleeds
Indian Construction Costs - A Biannual Review - July 2020

Summary of the Indian
Economic Outlook

The Indian economy no different to the global economy         of labour has influenced the anticipation of return of
has been in a turmoil as a consequence of the Covid-19        normalcy to only be in Q1 2021.
outbreak, declared by the WHO on the 30th of January
2020 as a global emergency. Like other countries, India’s     The IMF in mid-April predicted that the growth rate is likely
economy also depends on the control of the pandemic           to bounce back to 7.4% in 2021, if the virus is contained.
spread.                                                       This is quite positive as India is one of the few economies
                                                              that show expansion despite the pandemic avalanche.
As a result of the pandemic, uncertainty clouds forecasts,
however, the global economy is projected to contract          The employment rate estimates by Centre for Monitoring
sharply by –3 percent in 2020, much worse than                Indian Economy (CMIE) show that unemployment shot
during the 2008–09 financial crisis as reported by the        up to 24% for the week ending on the 17th of May 2020
International Monetary Fund.                                  which then rapidly fell to an average 11.1% in the last
                                                              week of June 2020, following the ease of lockdown
In India, there are various constraints faced by businesses   regulations.
today. The lockdown and the complete close of business
for a month, for some cities even more, the drop in           India’s economy is on its path to recovery, with small and
demand, disruption in the supply chain, a credit crunch,      medium scale businesses, construction sites, travel and
non-availability of access to raw materials and movement      restaurants all slowly recommencing.

                                                                                           Taj Vivanta - Yeshwantpur, Bangalore

July 2020                                                                                                                         5
Indian Construction Costs A Biannual Review - July 2020 - Gleeds
Indian Construction Costs - A Biannual Review - July 2020

H1 2020 Economic Overview

                                                                                         GDP Projections Y2020
                                                                                                             4.20%
                                                                                         4%

The lockdown implemented from the end of March into                          logistics, facility management, finance, insurance, and
May 2020, weighed the Indian economy down. The                     1.90%     manufacturing sector given the increase in demand
Government has tried to ease out on small businesses                         following the COVID-19.
                                                                            1.00%
                                                                                                   0.80%
with the aim to lighten the weight on the economy,
however the adverse effect of the lockdown is yet                            Informal labour, however, are0.20% seen to   commence work
                                                                                                                      -0.40%

unknown.                                                             IMF     immediately
                                                                           World Bank ADB post
                                                                                           Fitch the lift
                                                                                                      SBI in regulations,
                                                                                                              Moody's  UBS being mostly daily
                                                                             wage workers.

Gross Domestic Product (GDP)                                                                               Unemployment Rate
                                                                            30%                                                    24.95       25.79
                                                                                                                                   23.52       23.48
                                                                            25%

GDP in the year 2019 was 4.2% and in the given                              20%                                                     22.89
                                                                                                                                               22.48       12.38
circumstances dropping as per the predictions of                                                                        9.41
                                                                                                                                                           11.13
                                                                            15%                    9.7       8.65       8.75
global economists demonstrated in the graph below.                                   9.02
                                                                                      7.6         7.22       7.76
                                                                            10%
                                                                                                                                                           10.56
                                                                             5%                                         8.44
                         GDP Projections Y2020                                       6.93         6.06       7.34
                                                                             0%
                                          4.20%                                     Dec-19       Jan-20     Feb-20      Mar-20    Apr-20       May-20    Jun-20
                         4%
                                                                                  Rural Unemplyment Rate                Urban Unemployment Rate                India

                                                                                                                                             Source: CMIE
1.90%                                                                                                                       Reported as on 28th June 2020.
             1.00%
                                 0.80%
                                                   0.20%
                                                            -0.40%           Inflation
   IMF      World Bank   ADB     Fitch     SBI    Moody's    UBS

                                                                    The inflation rates in India have once again fluctuated
                                                                    with the Covid-19 crisis. It averaged 5.98 percent from
                                                                    2012 until 2019, reaching an all-time high of 12.17
                                  Unemployment Rate                 percent in November of 2013 and a record low of 1.54
Unemployment
         30%                                           24.95   25.79
                                                                    percent in June of 2017. The growth was estimated to
                                                       23.52   23.48
         25%                                                        be steady from 2020 as noted below, until the outbreak,
                                                                    the projected rate of inflation for the year 2020 is
         20%                                            22.89
The rate of unemployment had increased to       23.48%
                                             9.41             22.48 estimated
                                                                          12.38to be 3.34%:
         15% as reported by
in May 2020                9.7the   8.65
                                  Centre for  Monitoring
                                             8.75                         11.13
                  9.02                                                                    Inflation rate year on year
Indian Economy.    This   7.22 over7.76
                   7.6 reduced        June once there
         10%                                                      12%
was an ease in the lockdown regulations, falling to                       10.56
                                             8.44                 10%
17.2% in the
          5% first week of June and then 11.1%
                  6.93    6.06      7.34            end
of June 2020.                                                      8%
              0%
                     Dec-19    Jan-20    Feb-20   Mar-20    Apr-20    May-20
                                                                          6%      Jun-20
The job market does look grim this year. The
                                                                  4%
corporates areRural
                 notUnemplyment  Rate
                     sure what the           Urbanand
                                     future holds  Unemployment
                                                      are       Rate                     India
                                                                  2%
rationalising their sector. There is a reported optimism
that job seekers may find relief towards the end of               0%
                                                                                  2011    2012    2013    2014   2015    2016    2017   2018    2019    2020   2021
this year, with medium and small size enterprises
                                                                                                                                                 Source: Statista
hiring. There also may be better opportunities in the
                                                                                          Note: As per the source, year 2020 and 2021 are estimates.

July 2020                                                                                                                                                          6
                                                                                                         Inflation in % WPI and CPI
                                                                            12

                                                                            10
Indian Construction Costs A Biannual Review - July 2020 - Gleeds
4%

                                                       2%
                                                                                                Indian Construction Costs - A Biannual Review - July 2020
                                                       0%
                                                              2011       2012     2013     2014      2015     2016     2017      2018      2019    2020        2021

WPI and CPI

Both wholesale price index (WPI) and
                                                                                        Inflation in % WPI and CPI
the consumer price index (CPI) are
                                                       12
the change in the price of various
goods or services in the economy,                      10

where the wholesale price index                        8
measures the percentage change in                      6
the price in wholesale index, while
                                                       4
consumer price index measures the
                                                       2
percentage change in the price in
retail market and hence it is more                     0
useful for consumers rather than                       -2
businessman.
                                                       -4
                                                            2013-2014    2014-2015       2015-2016    2016-2017      2017-2018    2018-2019       2019-2020
                                                                                                                                                  Provsional
The graph demonstrates the inflation                                                     WPI (in %)              CPI (in %)
for wholesale price index and
consumer price index as noted by the
                                                                                                            Source: India Budget Economic Survey Report,
Indian Government. Also noted, the                                                                            The Government of India, Ministry of Finance
2019-2020 is provisional.

 $ USD to INR                                                                               Average USD to INR
                                                       80

                                                                                                                                                  74.12
                                                       75
                                                                                                                                   70.39
The graph is a trends graphs USD                                                                                       68.4
                                                       70                                   67.17
to INR, averaged. The Rupee in April                                            64.12
                                                                                                         65.1
2020 showed an all-time low of about                   65
                                                                  61
                                          USD to INR

77 a Dollar, and was predicted to                      60
reach a high of 80 end of June 2020,
                                                       55
however, it closed at 75.53 a dollar on
the 30th of June 2020, to average to                   50
about 74.12 a Dollar for the first half
                                                       45
of the year.
                                                       40
                                                                 Y2014          Y2015       Y2016       Y2017         Y2018        Y2019          Y2020

                                                                                                Source: XE Currency Charts as on the 29th of June 2020.

                                                                                                                                        Marks & Spencer

July 2020                                                                                                                                                      7
Indian Construction Costs A Biannual Review - July 2020 - Gleeds
Indian Construction Costs - A Biannual Review - July 2020

            Key Price Trends

                                                            Nokia

July 2020                                                            8
Indian Construction Costs A Biannual Review - July 2020 - Gleeds
Indian Construction Costs - A Biannual Review - July 2020

Key Price Trends

The price trends for the most used material in the industry are set to change as a result of the effect of the Covid-19
pandemic. Prior to March 2020 of commonly used construction material price trends are demonstrated below:

Steel Prices in Major Cities:
                                                  AVERAGE STEEL PRICE IN INR / YEAR
                          4,00,000

                          3,50,000

                                                                                                  56,850
                          3,00,000
                                                                                                                            51,595
                                        49,475                                                                     49,025
                          2,50,000                                                   45,200       57,525
                                                   41,000                                                                   52,200
                                        49,475                      39,500                                         49,375
                          2,00,000                                                   45,750       56,650
                                                   40,975                                                                   50,445
                                        50,875                      39,425                                         49,553
                          1,50,000                                                   45,375
                                                   43,275           38,400                        56,950
                                        49,475                                                                     49,700   52,700
                                                                                     45,250
                          1,00,000                 41,200           39,500
                                                                                                  55,825           50,230   53,799
                                        50,000                                       44,875
                                                   40,375           40,700
                           50,000
                                        49,425     42,025           38,400           45,375       56,650           49,753   53,312
                                -
                                         2014        2015            2016             2017         2018             2019     2020

                         Sources: Sail. Note: All year prices are averaged and in INR, and Sail have last updated rates in June 2020.
                                                                                                               All prices include GST.

As reported by the Economic Times, cement and steel sector output declined by 86% and 83% respectively in April 2020.

Diesel Prices In Major Cities:

                                                     AVERAGE PRICE IN INR / YEAR
                       450.00
                       400.00
                                                                                                  73.18            72.32     72.05
                       350.00
                                     60.53                                         61.86
                       300.00                                     57.84                           68.04            68.58     68.21
                                     60.22       53.12
                       250.00                                     55.35            57.38
                                                 51.55                                            69.87            68.50     68.38
                       200.00        62.74                                         59.51
                                                                  57.24
                                                 53.64                                            70.38            70.13     69.32
                       150.00        59.24                        54.55            59.23
                                                 50.01
                       100.00        55.56                                                        66.57            66.44     68.66
                                                 47.79            53.24            57.12
                        50.00
                                     63.71       54.56            59.02            59.92          70.64            69.63     69.10
                         0.00
                                     2014        2015             2016              2017          2018             2019      2020

                                                 Mumbai (Rs./Ltr)         Delhi (Rs./Ltr)      Chennai (Rs./Ltr)
                                                 Pune (Rs./Ltr)           Banglore (Rs./Ltr)   Hyderabad (Rs./Ltr)

   Source: My petrol price. Average price per year considered. For the year 2020 average price up until the 29th of June considered.

July 2020                                                                                                                                                    9
Indian Construction Costs A Biannual Review - July 2020 - Gleeds
Indian Construction Costs - A Biannual Review - July 2020

Price Trend Indices for Cement:

                                                                                           Average Rate Excl Tax
The graph shows a price trend for              260
                                                                                                                                                255
cement prices in Mumbai. In 2019,              255
even with the rise in demand, cement           250                                                       247
prices hiked and is said to have               245
                                               240
achieved it highest production level,
                                               235                                 231
with capacity utilisation of 78%.              230                                                                       225
                                                               224
                                               225
                                               220
                                               215
                                               210
                                               205
                                                              2015                 2016                 2017             2018                   2019

                                                                                 Source: Gleeds Internal Data (Mumbai). Prices are in INR and exclude GST.
                                                                                              Note: Price does not account for the impact of the Covid-19.

Aluminium and Copper:
                                                7000        6663.87
                                                                                                                    6549.00
                                                                                                        6209.25                   6054.13
The consumption of Aluminium                    6000                     5413.75
                                                                                                                                                  5250.25
and Copper is muted following the                                                         5010.38
                                                5000
lockdown and the drop in demand
and the full benefit of the drop in             4000
prices has been of no advantage for
the industry.                                   3000
                                                                                                        2050.00     2022.13
                                                            1823.00
                                                2000                     1630.50          1619.38                                 1797.63
                                                                                                                                                  1492.37

                                                1000
                                                                                                                                     Copper (USD)/Tonne
                                                                                                                                     Aluminium (USD)/Tonne
                                                     0
                                                            Y 2014        Y 2015          Y 2016        Y 2017      Y 2018        Y 2019           Y 2020

                                                                                                                Source: London metal exchange
                                      Prices noted are in USD and are averaged for the year and for year 2020 averaged up until the 29th of June.

Crude Oil:
                                                                                      CRUDE OIL (USD/BARREL)
Crude oil impacts inflation largely
                                                100.00
because of the manufacturing of raw                                   93.67
materials depends on it. Though ideally           90.00

construction materials like cement,               80.00
paints, glass, plastics, PVC pipes and            70.00                                                                             65.13

rubber prices move in tandem with the             60.00                                                                67.75
price of crude oil, other factors like, the       50.00
                                                                                                           53.73
present drop in demand, disruption of                                         50.39          49.54
                                                  40.00
supply of other raw materials and labour          30.00                                                                                               36.11
shortage has negated the advantage of             20.00
the price drop.                                   10.00

Additionally, transportation costs is                0.00
                                                              Y 2014          Y 2015        Y 2016        Y 2017      Y 2018        Y 2019          Y 2020
impacted majorly by crude prices,
however, with change in Government                                                                                                          Crude oil (USD/Barrel)
taxation, the benefit is not realized by
the end-user.                                                                                                                   Source: Country economy data

July 2020                                                                                                                                                            10
Indian Construction Costs - A Biannual Review - July 2020

            Material Prices

                                    The Den Hotel, Bangalore

July 2020                                                          11
Indian Construction Costs - A Biannual Review - July 2020

Material Prices

Material prices in various cities:

 Description            UoM                 Mumbai               Delhi          Bengaluru          Hyderabad          Chennai            Pune
 Cement
 Grade 43               INR/MT                6,800              6,800             5,840               6,800            6,400            6,000
 Steel
 Reinforcement          INR/MT               42,000             43,000             40,750             43,200           42,500           40,000
 Structural Steel       INR/MT               48,000             48,000             48,000             46,000           47,000           46,560
 Clear Glass
 6mm                    INR /Sqft               68                 68                82                 66                70               68
 8mm                    INR /Sqft               88                 88               102                 86                90               88
 Stone
 Granite                INR/ Sqft           150-250            120-250            90-250              90-250          115-250          115-250
 Marble                 INR/ Sqft           220-500            220-500            180-500            175-500          150-500          180-500
 Makrana                INR/ Sqft           250-1000           250-1000          250-1000           250-1000          250-1000         250-1000
 Kota                   INR/ Sqft             40-50              30-40             40-50              40-50             40-50            30-40
 Cuddappa               INR/ Sqft             20-25              20-25             15-25              15-25             20-25            15-25
 Wood
 Salwood                INR/ cuft             1,650              1,550             1,250               1,600            1,250            1,050
 Plywood
                        INR/ sqft               67                 63                70                 63                61               64
 12mm thick
 Paints
 Emulsion               INR/ 20 ltr           3,200              3,000             3,200               3,300            3,400            3,360
 Electrical Wires- Copper
 1.5 sq mm FRLS
                        INR/mtr                 15                14.5               14                 14                14              13.5
 Cu wire
 2.5 sq mm FRLS
                        INR/mtr                 23                22.5               22                21.5              21.5             21.5
 Cu wire
 4 sq mm FRLS
                        INR/mtr                 33                 32                31                 31               30.5             30.5
 Cu wire
 Electrical Al cable
 4Cx 2.5 Sqmm
                        INR/mtr                 67                65.5              63.5                63                62               62
 Al. Ar. Cable
 4Cx 4 Sqmm
                        INR/mtr                 72                70.5              68.5               67.5               67               67
 Al. Ar. Cable
 Electrical Cu Cables
 4Cx 1.5 Sqmm
                        INR/mtr                 85                83.5               81                 80                79               79
 Cu.. Ar. Cable
 4Cx 2.5 Sqmm
                        INR/mtr                118               115.5              112                 111              110              110
 Cu. Ar. Cable
 4Cx 4 Sqmm
                        INR/mtr                160                157               152                 150              149              149
 Cu. Ar. Cable

Source: As per Gleeds’ database in the month of June 2020 unless noted otherwise. All prices exclude GST.
All prices are supply prices and a guidance only. Transportation, and any other abnormals are not included.

July 2020                                                                                                                                         12
Indian Construction Costs - A Biannual Review - July 2020

            Labour Rate Trends

July 2020                                                              13
Indian Construction Costs - A Biannual Review - July 2020

Labour Rate Trends in Various Cities

The beginning of the lockdown at the end of March 2020,                     at the earliest as most are daily wage workers, it is also
saw a set of alarmed migrant labour, leave the cities to                    understood that the most labour, will have reservations
reach their homes in the hope of safety and security.                       on returning to Tier 1 cities following the failure to
When the rules we relaxed towards the end of May, most                      flatten the COVID-19 curve. The return of labour full
migrant labour left the cities back to the suburban small                   time to construction sites is only estimated post Diwali,
towns and villages. While, the labour will commence work                    anticipating no second wave of pandemic.

Note: Costs do not account for the impact of Covid-19. Rates for 2020 are as on Feb 2020. Rates are in INR and are daily wage rates.

1.    Mumbai:                                                               2.    New Delhi:

                                         544                                                                        569
                                       544                                                                        571
                                     495                                                                        534
            591                    479                                               689                      534
                                 462                                                   692                 368
              591
                541                                                                      648
                  525                                                                      648   New
                        Mumbai                                                               448 Delhi
                    509

                                482                       Year 2020                                       407                     Year 2020
                                 498                      Year 2019                                       588                     Year 2019
                                  514                     Year 2018                                       588                     Year 2018
                                  564                     Year 2017                                       629                     Year 2017
                                   564                    Year 2016                                        626                    Year 2016

              Unskilled     Semi-Skilled      Skilled                                  Unskilled      Semi-Skilled      Skilled

                                         Source: Minimum Wage-India                                                  Source: Minimum Wage-India

3.    Chennai                                                               4.    Hyderabad:

                                      350                                                                       330
                                    327                                                                        330
                                   327                                                                       319
                                 313                                                                        317
            450                 291                                                  478                   368
               421                                                                     478
                 421                                                                     462
                   403    Chennai                                                           377 Hyderabad
                      375                                                                     448
                                                          Year 2020                                                                Year 2020
                                 338                                                                       407
                                  364                     Year 2019                                          345                   Year 2019
                                   380                    Year 2018                                           376                  Year 2018
                                     380                  Year 2017                                            390                 Year 2017
                                      406                 Year 2016                                              390
                                                                                                                                   Year 2016

                Unskilled     Semi-Skilled      Skilled                                 Unskilled     Semi-Skilled      Skilled

                                               Source: Chennai.nic.in                                                Source: Minimum Wage-India

July 2020                                                                                                                                         14
Indian Construction Costs - A Biannual Review - July 2020

5.    Bengaluru:                                                     6.   Pune:

                                    385
                                   385                                                                      493
                                 358                                                                      493
                                                                                                       414
                               332                                                                   385
            405               310                                             539                  325
              405                                                               539
                377                                                               488
                  350 Bengaluru                                                      456
                                                                                        424 Pune
                    325
                                                     Year 2020                                                             Year 2020
                               317                                                                 346
                                341                  Year 2019                                      372                    Year 2019
                                 367                 Year 2018                                       443                   Year 2018
                                   395               Year 2017                                                             Year 2017
                                                                                                     512
                                    395              Year 2016                                        512                  Year 2016

              Unskilled   Semi-Skilled    Skilled                               Unskilled     Semi-Skilled      Skilled

                                     Source: Minimum Wage-India                               Source: Maharashtra Jeevan Pradhikaran

                                                    Post Covid-19 following a survey that was conducted by Gleeds in
                                                    the 2nd week of May 2020, it is noted that the labour rates were
                                                    predicted to increase by more than 10%.

Migrant labour has been badly hurt in the present crisis.             cities. Government aid including a three-month wage and
The complete lockdown on March 24th that came as                      supply of essentials like oil and rice, now announced till
a surprise to the entire nation, left the labour stuck in             the end of November 2020, have prompted labour to stay
large cities with little or no means to fend for themselves.          on in their hometowns. In the current monsoon season,
This brought about an exodus of labour on foot to their               work progress is slow and the labour are perceived to
villages. Post the relaxations of lockdown measures late              only return post monsoon, after the Diwali festivities when
May, most labour found their way back home and have                   the seasonal demand of the agricultural sector is over, the
commenced the seasonal agricultural jobs, refusing                    COVID-19 crisis is curtailed or contained and the need to
to return for large work on construction sites in bigger              earn resurfaces.

July 2020                                                                                                                               15
Indian Construction Costs - A Biannual Review - July 2020

            Construction Sector
                       Outlook

                          Vivanta by Taj, Coromandel, Chennai

July 2020                                                               16
Indian Construction Costs - A Biannual Review - July 2020

Construction Sector Outlook

The construction industry was on an upward trend in 2019.
                                                                 Residential Sector
All sectors were flourishing, especially the commercial and
residential sector. India also jumped to the 63rd position in   Residential sector was also on the road to improvement,
World Bank’s ‘Ease of Doing Business 2020’ report, both         with the pickup of affordable and mid-range homes, while
reflecting and attracting the confidence of local and global    the premium and ultra-premium was left more to end
entities.                                                       user requirements. The Indian Government had created
                                                                an alternative investment fund of INR 250 Billion for last-
                                                                mile funding of 1,600 stalled housing projects. GST rates
 Commercial Sector
                                                                were slashed from 8% to 1% for affordable homes and
There was a rise in IT companies across the country with        12% to 5% for regular units in March 2019 to make under
companies basing themselves in prominent cities like Delhi,     construction projects more attractive. Housing prices
Mumbai, Bangalore, Hyderabad, Chennai and Pune. The             however remained stagnant in the year and the growth
demand for commercial buildings rose and the supply was         rate was about 1%. However, it is understood that the IT
less, which brought about a higher rental cost, which in        hub cities like Mumbai, Hyderabad, Pune and Bangalore
turn brought about a good return in investment.                 showcased a slightly higher growth rate in comparison to
                                                                the other cities.
This sector was reported to have received $2.9 billion
investment from private sectors in the year 2019. Office
assets were continuously growing, and investment was                     Impact of Covid-19:        Medium Impact
providing stable returns. There has also been a 40% growth
in the sector for both leasing and pre-leasing.
                                                                       Home loan collection has plummeted in March
                                                                       2020, an effect of the pandemic. Residential
                                                                       bookings fell by about 78% as compared to January
            Impact of Covid-19:   Medium Impact
                                                                       2020. There have been 6.4lakh unsold units and
                                                                       4.7 lakh units yet to be completed nationwide in
        Delayed decisions on occupancy and hesitation                  the last quarter. The RBI has allowed a 3-month
        to rent or buy spaces brings this sector into an               moratorium on term loans till May 2020, which was
        uncertain standstill with no new revenue generation.           then further extended will August 2020, expecting
        The productivity of ‘work from home’ or WFH has                to release some pressure off the developers as
        increased in the lockdown period and there is a sure           well as home loaners, however their cash outflows
        possibility of reduction of the seat-based leases              in the long run maybe negated due to the stalled
        as a consequence of more staff availing the WFH                projects. The housing demand is seen to decline
        option. Offices are also now relooking into office             as investors might shy away in locking their capital
        space redesign or refurbishment to accommodate                 in physical assets in an unstable environment. With
        the social distancing and health and hygiene norms.            the overhanging job uncertainties following lay-offs
        There will be delays in the completion of office               and salary cuts home buyers may withhold till more
        spaces due to revised operating procedures (design             promising times, posing a challenge to the housing
        related such as upgrading HVAC and workspaces),                sector. There also now is an interest towards
        disrupted supply chain and the unavailability of               township following a desire to live in a controlled
        labour. Newer project propositions maybe withheld              environment. Tier II and Tier III cities may see a
        considering the present uncertainty. Firms are likely          rise in the demand for housing long term following
        to opt for centralized operations and consolidate              reverse migration and the reservation to move back
        their space holdings to cut costs and optimize work            into a crowded Tier I city.
        operations.

July 2020                                                                                                                         17
Indian Construction Costs - A Biannual Review - July 2020

 Hospitality Sector
                                                                           Impact of Covid-19:        High Impact
The market size of hotel industry in India (including
unorganized market) is estimated at $22 Billion in 2019,
growing at 8.6% till 2025. In the past few years, the year on            According to a Retailers Association of India report,
year growth rate has been about 7%. The tourism market                   by end of February itself, the business had dropped
in India has picked up which had a direct bearing on the                 by 20% to 25% and in March the business has
demand for the hotel, increasing the occupancy. There                    reduced to only 15% of the average yearly business.
was a reported 70% to 80% occupancy in 2019, while only                  ICRA estimates rental expenses form a sizeable
60% is required to being in a good return of investment.                 share of 12% to 16% of revenues for retailers,
Rapid urbanisation also saw the rise of tier 3 type hotels               therefore, all tenants are likely to negotiate for
and many hotel managements companies have started                        waiver or rebate of the rentals. Retailers Association
setting up in smaller towns. The rise of the economical                  of India states that India is staring at a scenario
hotels has pumped in large revenues.                                     where 30% of the retail stores would shut down,
                                                                         leading to 1.8 million people losing their jobs. The
                                                                         spending capacity of customers has reduced in turn
                                                                         affecting the sector. Having said that, the essentials
            Impact of Covid-19:   High Impact                            and pharmaceutical industry is adjusting to over
                                                                         demand and the practice of hoarding. Though malls
                                                                         and other large retail have reopened, there seems
        This sector which is heavily dependent on the trade,
                                                                         to be a big customer reservation against visiting
        travel and tourism, has come to a sudden standstill
                                                                         public places despite the all health and hygiene
        post the global travel bans and prolonged lockdown
                                                                         precautions being in place.
        in India. Employees have been laid-off and the
        indefinite timeline for reopening has brought this
        sector to a standstill. The sector is seen to be now       Healthcare Sector
        functioning at about 15% capacity, with occupancy
        consisting of people who are quarantined or medical       The healthcare sector has been growing steadily in the past
        personnel. The drop of revenue for the industry is        few years and has become one of India’s biggest sectors.
        expected to range from $4.2 to $4.7 billion with the      The market was estimated to increase three-fold by the
        most affected regions being Bengaluru, Mumbai,            Indian Brand Equity Foundation (IBEF), with a promising
        Delhi & Gurugram. The first to recover post the slight    scope for the contribution to the country’s GDP, which is
        relaxations maybe the economy and mid-scale               presently 1.15% of the total GDP.
        hotels, following the reopening of the manufacturing
        units in small towns and the agricultural sector.
        While this sector is adversely affected in other parts             Impact of Covid-19:        Medium Impact
        of the world, 80% of India’s revenue is generated
        from domestic travel which may pick up faster when              The healthcare system has also been impacted
        the COVID-19 curve is flattened.                                during the ongoing crisis. The unprecedented
                                                                        situation has challenged the sector to provide and
                                                                        support the unforeseen needs. The government
 Retail Sector                                                          sector has now been supported by the private
                                                                        sector to cater to the COVID crisis. The sector
This sector seemed to have struggled in the past year                   is experiencing a deficit on the requirement of
2019. The leasing activities reduced across the major                   equipment, consumables and resources such
cities and the level of vacancy fell slightly from the previous         as beds, ventilators and manpower and is still
                                                                        learning to cope with the rise in safety and hygiene
year. The retail industry however attracted private equity
                                                                        requirements to prevent the contraction of the
investments from around the world totalling to around
                                                                        Virus. Along with this however, there is a significant
1billion US dollar, which seemed to be a promising market               drop in the outpatient and surgery requirements,
for the international retailers.                                        more based of the psychology of possible patients.
                                                                        This trend is expected to continue for the next
                                                                        6 months, in anticipation that a more permanent
                                                                        solution to the COVID crisis is found.

July 2020                                                                                                                           18
Indian Construction Costs - A Biannual Review - July 2020

 Pharmaceutical Sector                                             Manufacturing Sector

India’s Pharmaceutical sector is the largest producers of         This sector accounted for about 16.8% of India’s total
vaccines in the world and is a generic provider of drugs          GDP as per the Ministry of Statistics and Programme
globally. It supplies over 50 per cent of global demand for       Implementation (MoSPI). Both domestic and International
various vaccines, 40 per cent of generic demand in the US         Investments in the Indian manufacturing unit have been on
and 25 per cent of all medicine in UK. The projection of the      the rise. Government policies such as ‘Make in India’ and
industry was at about 10-12 percent in the next five years        sector specific investments in various companies aim to
leading the country to be amongst the top ten in world            make India a global hub. The introduction of GST evened
for medicine spending. The Government with the vision to          out the tax complications and served as a big attraction for
make India the world leader in end to end production of           foreign investors.
pharmaceutical products, introduced the Pharma vision
2020, with the goal to systemise the process.
                                                                           Impact of Covid-19:         Low impact
            Impact of Covid-19:   Medium Impact
                                                                         It may be noted that these units though slowing
        The active pharmaceutical ingredients also known                 down maybe the sector which will be running
        as API’s are mostly sourced by India from China.                 through and post Covid-19 crisis. There would be
        Post COVID-19, the supply of this has gone into                  a demand for locally made and sourced materials
        an acute shortage. It would be prudent for the
                                                                         allowing the sector to find a new path for growth.
        country to now look to source this APIs locally to
                                                                         With China being the epicentre of the pandemic,
        bridge the gap between the supply and demand
        of the pharmaceuticals that it is set out to produce             it will be natural that the global market might look
        and export. The breakthrough may allow India to                  for other alternatives. India was already preparing
        be the global option which will boost the industry               to boost its manufacturing sector, and the policies
        significantly. The policy of ‘Pharma India 2020’                 and taxations have already been implemented to
        was aiming to make India the no 1 manufacturing                  ease business, opening opportunities to global
        industry for end to end pharmaceuticals                          investors to consider India for its manufacturing
        manufacturing. The rise in sales is likely to bring up           base. Having a growing strength of working
        the demand for pharmaceutical manufacturing units.               population, this sector has a potential to surge.

 Data Centres
                                                                        With the present work from home options the
India in the past two years India has grown in the usage                requirement for data storage has risen, replacing
of data centres, following most of the IT sectors moving                server- based systems. Data centres are also
their infrastructure to cloud. Increased digitalization efforts         now a welcome and necessary option for most
of the Indian government and plans for smart cities is                  companies considering the amount of data
another driver. Data localization mandates driven by the                generated as a result of WFH options being used.
government has also led to increased regional presence                  This overwhelming data pressurises a company’s
by the MNCs and big tech companies like Google,                         in-house capabilities paving a path for the use
Apple, Amazon/AWS, Microsoft, Facebook, as well as                      of data centres. The pandemic, uncertainty,
e-commerce giants. It is also noticed that Mumbai has the               and isolation have made storage and dispersal
highest use of data centres accounting for the nearly half              of digital data pivotal in preventing the global
of India’s usage. The financial sector also was looking at              economic system from collapsing. Even before the
an increased demand in data storage following the RBI                   outbreak, the global focus had already shifted to
mandate on use of servers located in different parts of the             AI, cloud storage and IoT. Flexibility of usage and
country.                                                                payment, such as pay as you go, allows for less
                                                                        initial investment from a company’s point of view
                                                                        and the is more economical with very little space
            Impact of Covid-19:    Low impact                           constraints. The usage of data centres are more
                                                                        likely to rise now as most companies are relooking
                                                                        into their digital infrastructure and moving towards
                                                                        the use of data centres.

July 2020                                                                                                                           19
Indian Construction Costs - A Biannual Review - July 2020

            H1 2020 Construction
              Costs: Sector Wise

                                                   Marks & Spencer

July 2020                                                                20
Indian Construction Costs - A Biannual Review - July 2020

H1 2020 Construction Costs: Sector Wise

Sector Wise Costing:

                                    Assumptions for                 Bengaluru                        Pune                         Delhi
 Building Type
                                        Costs                        ₹ / Sqft                       ₹ / Sqft                     ₹ / Sqft
 Residential
 Affordable                       BUA: 3,00,000 sqft              1,950 to 2,300                1,900 to 2,200               2,290 to 2,715
 Premium                          BUA: 6,00,000 sqft              2,460 to 3,305                2,460 to 3,305               3,200 to 3,600
 Commercial Building
 Commercial                       BUA: 10,00,000 sqft             2,350 to 2,800                2,700 to 3,000               2,950 to 3,400
 Office Fit-out    Note: Costs based on carpet area for office fit-outs only.
 Basic                            CA: 15,000sqft                  2,000 to 2,400                2,000 to 2,300               2,000 to 2,500
 Standard                         CA: 30,000sqft                  2,600 to 3,200                2,400 to 3,200               2,600 to 3,400
 Premium                          CA: 50,000sqft                  4,000 to 7,000                4,000 to 6,500               4,000 to 7,200
 Retail
 Malls with retail stores                                         2,415 to 2,800                2,375 to 2,750               2,400 to 2,950
 Store fit-out costs on carpet area
 Quick Service Restaurants        CA: 2,500 sqft                  2,750 to 3,200                2,700 to 3,150               2,900 to 3,300
 Apparel stores                   CA:25,000 sqft                  2,000 to 2,300                2,000 to 2,200               2,150 to 2,450
 Discount sports store            CA:25,000 sqft                  1,250 to 1,800                1,200 to 1,750               1,500 to 1,900
 Jewellery                        CA: 8,000 sqft                  5,000 to 6,500                4,800 to 6,200               5,500 to 7,000
 Hospitality
 3 star Hotel                     100 key                         3,800 to 4,650                3,400 to 4,500               4,600 to 5,500
 4 star Hotel                     150 key                         4,650 to 5,500                4,250 to 5,100               5,950 to 6,800
 5 star Hotel                     150 key                         6,800 to 8,500                6,300 to 7,800               7,500 to 9,000
 Healthcare
 Hospitals                        500 bed capacity                4,500 to 5,200                4,550 to 5,300               5,500 to 6,600
 Education
                                  500 Pupil,
 School*                                                          2,600 to 3,300                2,300 to 2,850               4,250 to 4,800
                                  high school
 University**                     Campus                          5,100 to 5,800                4,700 to 5,500               5,500 to 6,350
 Industrial
 Pharmaceutical                                                   3,300 to 4,200                2,970 to 3,800               3,500 to 4,300
 Others
 Multi-level Car park                                              850 to 1,200                  800 to 1,050                1,050 to 1,300
 Data Centres
 Shell only                       Multi-tenant                    4,200 to 6,200                4,200 to 6,000               4,400 to 6,350
 Shell only                       Hyperscale                      5,250 to 7,150                5,100 to 7,000               5,400 to 7,350
 Fit-out (₹/MW)                   Multi-tenant                                         18,00,00,000 to 22,00,00,000
 Fit-out (₹/MW)                   Hyperscale                                           16,00,00,000 to 20,00,00,000

* Classroom with basic indoor and outdoor facilities.
**Learning rooms with required amenities
Note: The costs noted in the above table do not reflect the impact of Covid-19 and is pre Covid-19 pricing.
Source: Gleeds India Data-base

July 2020                                                                                                                                         21
Indian Construction Costs - A Biannual Review - July 2020

Sector Wise Costing:

                               Assumptions for                        Mumbai                        Chennai                    Hyderabad
 Building Type
                               Costs                                  ₹ / Sqft                      ₹ / Sqft                    ₹ / Sqft
 Residential
 Affordable                    BUA: 3,00,000 sqft                 2,375 to 2,800                1,865 to 2,205               1,865 to 2,100
 Premium                       BUA: 6,00,000 sqft                 3,200 to 3,750                2,545 to 3,050               2,400 to 3,000
 Commercial Building
 Commercial                    BUA: 10,00,000 sqft                3,050 to 3,500                2,300 to 2,750               2,375 to 2,800
 Office     Note: Costs based on carpet area for office fit-outs only.
 Basic                         CA: 15,000sqft                     2,200 to 2,700                1,900 to 2,300               2,000 to 2,400
 Standard                      CA: 30,000sqft                     2,800 to 3,600                2,400 to 3,000               2,600 to 3,200
 Premium                       CA: 50,000sqft                     4,000 to 7,500                3,800 to 6,200               3,900 to 6,500
 Retail
 Malls                                                            2,545 to 3,000                2,375 to 2,800               2,375 to 2,700
 Store fit-out costs on carpet area
 Quick Service
                               BUA: 2,500 sqft                    3,000 to 3,400                2,700 to 3,100               2,750 to 3,200
 Restaurants
 Apparel stores                BUA: 25,000 sqft                   2,200 to 2,500                1,900 to 2,250               2,000 to 2,300
 Discount sports store         BUA: 25,000 sqft                   1,500 to 2,000                1,200 to 1,700               1,250 to 1,800
 Jewellery                     BUA: 8,000 sqft                    5,500 to 7,000                5,000 to 6,000               5,000 to 6,500
 Hospitality
 3-star Hotel                  100 key                            4,650 to 5,900                3,700 to 4,500               3,400 to 4,660
 4-star Hotel                  150 key                            5,950 to 7,200                4,500 to 5,400               4,350 to 5,500
 5-star Hotel                  150 key                            7,500 to 9,500                6,400 to 7,500               6,800 to 8,100
 Healthcare
 Hospitals                     500 bed capacity                   5,500 to 6,800                4,200 to 5,000               4,400 to 5,200
 Education
                               500 Pupil,
 School*                                                          4,650 to 5,000                2,500 to 3,250               2,550 to 3,650
                               high school
 University**                  Campus                             5,950 to 6,500                4,650 to 5,500               4,650 to 5,550
 Industrial
 Pharmaceutical                                                   4,000 to 5,500                3,100 to 4,000               3,250 to 4,100
 Others
 Multi-level Car park                                             1,200 to 1,350                 800 to 1,100                 850 to 1,200
 Data Centres
 Shell only                    Multi-tenant                       4,650 to 5,750                4,100 to 4,900               4,250 to 5,100
 Shell only                    Hyperscale                         7,800 to 8,300                6,150 to 7,000               6,100 to 7,200
 Fit-out (₹/MW)                Multi-tenant                                            18,00,00,000 to 22,00,00,000
 Fit-out (₹/MW)                Hyperscale                                              16,00,00,000 to 20,00,00,000

*Classroom with basic indoor and outdoor facilities.
**Learning rooms with required amenities.
Note: The costs noted in the above table do not reflect the impact of Covid-19 and is pre Covid-19 pricing.
Source: Gleeds India Data-base.

July 2020                                                                                                                                         22
Indian Construction Costs - A Biannual Review - July 2020

Assumptions Made and Notes
for reading the Costs

Data provided in this report is an average range of costs.              costs indicated. The following are the parameters that are
There are many cost parameters that contribute to costs                 to be considered:
and some judgement is to be applied while using the

                                                         Procurement
             Site conditions                                                                        Market conditions.
                                                         route considered

                                                                                                    Assumptions made
             Location                                    Design
                                                                                                    on site abnormal

             Building shape                              Requirements of                            Time scale for
             and size                                    the end user                               completion

                                                         Quality and safety
             Contract type                                                                          Any site restrictions
                                                         systems required

Please note the following pertaining to the costs data                 All costs are deemed to exclude:
provided.
                                                                       •    Site abnormals and any specific site conditions.
• All costs noted are construction costs only.
                                                                       •    Client’s cost for land acquisition
• All costs are in Indian National Rupees unless noted
                                                                       •    Client’s overheads
   otherwise.
                                                                       •    Client’s profit margin
• All costs are per square foot unless noted otherwise.
                                                                       •    Pre-opening costs
• All cost data is indicative of costs incurred at the time
   of the making of the report.                                        •    Consultants, designers, and other project management
                                                                           fees
• The impact of Covid-19 is not accounted. All costs are
   pre-Covid-19 unless noted otherwise.                                •   Land Value
                                                                       •   Project Insurance
All costs are deemed to include:
                                                                       •   Force Majeure
• All construction costs including shell and core,
                                                                       •   Any administration costs incurred by the Client.
     architectural works, interiors and finishes, MEP and
     external development works unless noted otherwise.                •   Any preclearing, logistic costs incurred by Client before
                                                                            site hand over to contractor. GST
• Contractor’s preliminaries
                                                                       •    GST.
• Contractor’s overheads and profits
• Contingency
• Inflation (tender and construction inflation)

Area definitions followed in this document.

                        As per IS 3861-2002                                        RERA

   Built up area        Plinth area shall mean the built-up covered measured       The built-up area includes the carpet area, plus the
   (BUA)                at the floor level of the basement or of any storey        extra areas certified by the authorities, such as the area
                                                                                   of the outer and inner walls, dry balcony area, etc.

All costs noted below is on the built-up area unless noted otherwise. This indicates the cost incurred on all the unusable
areas, still contribute to costs.

July 2020                                                                                                                                       23
Indian Construction Costs - A Biannual Review - July 2020

            City Cost Indices

                                               Marks & Spencer

July 2020                                                            24
Indian Construction Costs - A Biannual Review - July 2020

City Cost Indices

Gleeds carried out an extensive exercise to map the costs                                Appropriate weightage was given to each of the items and
across the various Indian cities.                                                        based on weighted average method, a base Index was
                                                                                         calculated.
The following methodology was adopted to derive the
indices.                                                                                 • December has been considered as the base month as this
                                                                                         is the best representation of costs before the uncertainty of
• A basket of items comprising of the most commonly
                                                                                         the pandemic. The base city taken for calculation of Index
used materials in construction, labour and consumables
                                                                                         is Bangalore.
was established. These goods have been identified and
known to demonstrate the inflation and dynamic nature                                    • Cost movement for the different cities across similar
of the goods typically used in the construction sector.                                  timelines has been mapped and the indices were thus
Approximate individual quantities within the items were                                  derived.
taken to represent standard type of commercial building.

The graph below indicates the construction costs indices for the six major cities for four months
starting December 2019, with Bengaluru as the base.

                                          Construction Cost Indices for Various Cities
             115.00

                                                                                                                                                                113
             110.00
                                                                                                                                        111

                                                                                                                                                          109
                                                                                                                108
                                         108

                                                                                                                                  107

             105.00
                                                                                                                                                    107
                                                                                       106

                                                                                                                            105

                                                                                                                                              105
                                   105

                                                                104

                                                                                                          104
                                103

                                                                                 103

                                                                                                                      103

             100.00
                                                          102

                                                                           102

                                                                                                    102
                                                    101
                          100

                                                                                               99
                                               98

                                                                      98

              95.00

              90.00
                             Bangalore               Pune                  Chennai              Hyderabad                    NCR                    Mumbai

                                                                Dec-19     Jan-20            Mar-20        May-20

            Source: Gleeds’ Internal Database.

July 2020                                                                                                                                                             25
Indian Construction Costs - A Biannual Review - July 2020

            Industry Transformation

                                                Godrej One, Mumbai

July 2020                                                                  26
Indian Construction Costs - A Biannual Review - July 2020

Industry Transformation

                                                                 •   Regular disinfection
                                          Clean workspaces       •   Regular cleaning and sanitisation
                                                                 •   More sanitisation stations

                                                                 •   Self-owned personal protection equipment.
                                                                 •   Less contact points
                             Safe workspaces
                                                                 •   Infrared cameras for temperature checks
                                                                 •   Sustainable designs

                                                                 •   De-densification of offices
                                                                 •   More work from homes options
                                           Social distancing
                                                                 •   Introduction of work shifts
                                                                 •   Staggered break times

                                                                 •   Reassessed productivity.
                                                                 •   Revised programme timelines.
  Project completion times will be revised based on
                                                                 •   Distorted supply chain.

                                                                 •   Use locally sourced materials.
                                                                 •   Prefer local manufacturers.
                                    Supply chain rebalance
                                                                 •   Preferred readily available products.
                                                                 •   Mechanized Construction.

                                                                 •   Modular construction
                          Construction trends                    •   Prefabrication
                                                                 •   3D printing for commonly used components

                                                                 •   Artificial Intelligence
                                                                 •   Virtual realty and Augmented realty
                                                                 •   Drone technology
                                        Move to technology
                                                                 •   BIM
                                                                 •   Automation
                                                                 •   Parametric design

                                                                 •   Return to sites only in November (estimated)
                                 Labour Crisis                   •   Additional prelims for labour camp
                                                                 •   Increase in daily wage

                                                                 •   Change in Contractual terms- Force Majeure
                                                                 •   Change in contractor’s prelims
                                                                 •   Site management
                                                  Evolution
                                                                 •   Project management
                                                                 •   Human Centric Design
                                                                 •   Programme

July 2020                                                                                                            27
Indian Construction Costs - A Biannual Review - July 2020

                  Look Ahead

                                                  Taj, Chennai

July 2020                                                         28
Indian Construction Costs - A Biannual Review - July 2020

Look Ahead

The construction industry is a good contribution to the        Material and labour are not only cost contributors but
nations’ economy and the industry has commenced                also the root of the construction activities. Supply chain
works, when the lockdown regulations were relaxed late         disruptions and unavailability of labour may cripple the
May 2020. Sites works have resumed in some cities, with        smooth flow of construction activities and giving rise to
renewed standard operating procedures to create a safe         delays and losses. However, the industry now has time to
work environment. While some cities are still shutdown,        look at retrieving it’s foothold from the sudden unforeseen
clients have commenced on the designing strategies and         downslide, by focussing on ‘working with the COVID-19’
are occupied with readying design and other pre-contract       and rearranging itself to best suit the new requisites.
works for future projects.
                                                               A look towards technology will also be a key to the world
For the newer construction, set out to commence after          of construction which may include a drive towards use
the period of 6 months, based on a survey conducted by         of machinery, new equipment and the adaptation of less
Gleeds’ in the second week of May 2020, it is predicted        popular forms of construction such as pre-engineered
that cost of construction might increase by 5% to 7%           buildings/modular construction.
provided the country is COVID-19 free. However, with that,
is also the increase of the Contractor’s prelims which is
                                                               Moving into the future which includes co-existing with the
a consequence of the mandatory high health and safety
                                                               COVID-19, the industry is seen to be picking up the pieces
requirements for site cleanliness and labour camps. This
                                                               and reconstructing itself to move forward into a better
maybe slightly offset with the reduction in the contractor’s
                                                               tomorrow.
mark-up, which may be offered to ensure competitiveness
and with the intent to survive in the market.

                                                                                                                  Taj, Chennai

July 2020                                                                                                                        29
Indian Construction Costs - A Biannual Review - July 2020

References

•   IBEF: About Indian Growth rate and statistics. [www.ibef.org]

•   Statista: India inflation rate from 1984 to 2021 [www.statista.com]

•   Government of India, Ministry of Finance: Economic Survey 2019-2020 [www.indiabudget.gov.in]

•   GDP growth forecasts [www.adb.org]  [www.imf.org] and media reports

•   Indian retail industry analysis [www.ibef.org]

•   Manufacturing Sector in India [www.ibef.org]

•   Indian real estate industry [www.ibef.org]

•   Healthcare industry in India [www.ibef.org]

•   Monetary Policy Report. [www.rbi.org.in]

•   Covid-19: Impact on real estate, Credai-MCHI [www.mchi.net]

•   India real estate-A different world post Covid-19, Anarock  [api.anarock.com]

•   Media reports: Economic Times, NDTV, Business Standard, The Hindu Business Line, Moneycontrol, India today and
    Zee business.

Abbreviations

MRICS: Member of the Royal Institution of Chartered             Sqmm: Square millimetre
Surveyors.
                                                                Ltr: Litre
USD: United States Dollar
                                                                Mtr: Linear metre
INR: Indian National Rupee
                                                                MT: Metric tonne
GST: Goods and Services Tax
                                                                FRLS: Fire retard low smoke
MEP: Mechanical, Electrical and Plumbing
                                                                Al: Aluminium
BUA: Built-up area
                                                                Cu: Copper
CA: Carpet area
                                                                Ar: Armoured
Sqft: Square foot
                                                                MW: Mega Watt
Cuft: Cubic feet

July 2020                                                                                                                          30
Indian Construction Costs - A Biannual Review - July 2020

Our Services

                           A MULTIDISCIPLINARY APPROACH

   Gleeds operates a partnering principle with clients and project teams, offering impartial
   advice across an extensive range of services to provide solutions for every stage of the
                                     property life-cycle.

                • Project Management – control and delivery of your projects
                  • Cost Management – predictability and control of costs
                            • Health & Safety • Project Monitoring
                     • Advisory – delivering bespoke integrated solutions
                              • Gleeds Digital Services (GDS)

India Overview

                                                                                    Residential
                                                                                   117 million sq.ft

                                                             Education                                          Hospitality
                                                           5.2 million sq.ft                                    6397 Keys

                                                                                    Sector
                                                        Mixed Use                  Presence                       Industrial
                                                      18.8 million sq.ft                                         4 million sq.ft
                                                                                     India

                         Bangalore (Head Office)
                                                        Commercial                             Leisure &               Retail
                         Mumbai                        88 million sq.ft                       faith Based           24 million sq.ft
                                                                                              9 million sq.ft
                         Pune
                                                                                    Healthcare
                         Delhi NCR
                                                                                    3060+ Beds

                         Chennai

                         Hyderabad

July 2020                                                                                                                  31
Indian Construction Costs - A Biannual Review - July 2020

        Register with Gleeds- our cloud based integrated
        registration database for design professionals,
        contractors, suppliers and product manufacturers,
        recently launched to allow us to reach out to you
        quicker for our upcoming project opportunities.

        Click on https://tinyurl.com/gleedsregister or scan
        the QR code using your camera to complete the
        registration.

        For queries regarding the registration, please write
        to us at register@gleeds.in

        For any further queries, please contact
        Gleeds India Insight and Analytics at insights@gleeds.in or:

        Ben Huskisson, MRICS                                                          Vishal Shah, MRICS
        Managing Director                                                             Director
        Email: ben.huskisson@gleeds.in                                                Email: vishal.shah@gleeds.in

        Ashish Pimpalkhare, MRICS                                                     Sushma Wilson, MRICS
        Senior Associate Director                                                     Executive Cost Manager
        Email: ashish.pimpalkhare@gleeds.in                                           Email: sushma.wilson@gleeds.in

        This issue was compiled by Gleeds India I&A with contributions from Siva Senathipathy, Jagjit Avdeel, Balaprakash B,
        Ravi K, PVSS Varma, Jagan Mohan k, Mallikarjun GS, Tushar Banerjee, Mayura Godse, Vimalraj B, Ramana Kumar,
        Bhagyshree Parikh, Kiran Pawar, Rahul V, Rajesh Babu, Bharat H, Padmini G and Srinivas S.

        © July 2020 by Gleeds Consulting (I) Pvt. Ltd.

        Legal Disclaimer: This paper was prepared by Gleeds India Consulting (I) Pvt. Ltd. and is for general information only. Neither Gleeds nor
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Indian Construction Costs - A Biannual Review - July 2020

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