The commercial real estate industry in Gujarat is undergoing rebirth. For FY 2024–25, the state saw the number of commercial project launches return to pre-pandemic levels, with 245 new projects, something not seen since 269 new projects were launched in 2019–20. This is a healthy recovery from the severe 58 % decline in commercial registrations from the Covid-19 crisis of 2020–21, when lifestyle changes and lockdowns severely hampered demand.
Market Dynamics & Investment Trends
As of January 2024–25, 31,520 commercial units registered, the highest level of registration since the pandemic ended. This includes 72 different projects in Ahmedabad alone which had a hefty investment of ₹3,394 crore.
In prior years, the declines in commercial projects (2019-20 and 2020-21) were notable and followed by significant recoveries in 2021-22 and by 2023-24; the boost seen so far in 2024-25 doesn't appear to be slowing down. The state observed a 15.6 % increase in new projects and the 20.7 % increase in investment.
A Shift Toward Green, Efficient Spaces
A second noteworthy trend is the rise of green building practices. In larger cities, approximately 40–50 % of new commercial projects are now green certified which are supported by incentives from the state government (7–12 % relief on chargeable FSI since it shrinks the overall building footprint). Energy savings of more than 30 % are also operationally beneficial. Buyers too are moving toward sustainable buyers as they prefer more energy efficient, eco-friendly commercial spaces.
Evolving Project Economics
Delving deeper into project economics:
Unit costs fell from ₹34 lakh in 2017–18 to ₹25 lakh in 2022–23, then rose to ₹44 lakh in 2023–24 and fell back to ₹40 lakh in 2024–25, an upward trend toward higher-value commercial units.
Meanwhile, average project unit counts descended from 137 units in 2018–19 to 107 units in 2021–22 but rebounded to 131 in 2023–24 and then settled at118 in 2024–25.
This fluctuation indicates developers may be choosing to develop more specialized, high-value and frequently smaller projects—partly indicating changing business requirements in an increasing maturing demand-driven market.
Implications for Investors & Developers
So, what does this resurgence mean for invested parties to anticipate?
Investors: Continued demand for high-quality energy-efficient projects, as well as rising unit values, signifies continued positive appreciation and rental potential.
Developers: Green construction has shifted from once a niche, to now a very attractive differentiator. Moreover, the tilt toward customized, higher-value projects offers opportunities for premium positioning.
Urban Growth: Ahmedabad and other centres attract significant commercial development which can help stimulate job growth and provide necessary infrastructure to sustainable urbanization.
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In Summary
Gujarat’s commercial realty sector has not only bounced back — it is changing. With 245 new commercial projects launched in 2024–25 and 31,520 units registered, the sector is reclaiming its pre-pandemic vitality. Green construction is on the rise, and a shift toward premium, customized, and sustainable spaces is redefining developer and investor sentiment.
With Ahmedabad continuing to be a commercial launchpad--with all new opportunities to be explored for modern office areas, showrooms, shops and more--working with experienced collaborators such as RES Management can be your advantage in making smart, future-proof property investments.
