Real estate can create national wealth at a scale no other industry can: Abhishek Lodha

PROPERTY PULSE 

India’s real estate industry is entering a phase that could shape wealth, employment and middle-class growth, with the next 10-15 years offering developers an opportunity to build a stronger base.

“About 50% of the nation’s wealth is in real estate, while only 5-5.5% of personal wealth is in the equity market. If home prices rise 8% annually, national wealth rises 4% that year. We have the opportunity to create massive employment and national wealth at a stage which no other industry can,” said Abhishek Lodha, MD and CEO of Lodha Group. 

Abhishek added that the opportunity is evident from the role housing and infrastructure played in the development of other economies. He pointed to the US between 1945 and 1970, when housing and infrastructure expansion helped create the American middle class, and China’s modernisation from the 1990s, when similar investments supported economic transformation.

Speaking at the 24th edition of NATCON organised by the Confederation of Real Estate Developers' Associations of India (CREDAI) in Kolkata, Abhishek Lodha said India is going through a similar phase, supported by infrastructure creation and a productive population.

For developers, however, Abhishek said the opportunity comes with a responsibility to retain the trust of customers, employees and investors. His company measures itself by asking whether an existing customer will buy again, whether an employee who leaves would consider returning, and whether an investor would invest again.

“The real currency to gain is trust. A consumer buys from you for the first time on hope. When he buys from you for the second time, he is buying because he trusts you. That second purchase is the real test. We have made mistakes, overextended ourselves, had quality issues and delayed projects, but none of that has stayed. What has stayed is trust,” Abhishek noted.

He linked this focus on trust to employees. Abhishek joined the family business in February 2003, when it had annual sales of Rs 20 crore, 20-25 employees and no debt. It now has more than 5,000 employees, with separate leaders for residential, rental and data centre businesses.

Abhishek noted that attracting talent from different industries and geographies had supported the company’s growth, adding that businesses need to make employees feel part of the journey. He also cautioned developers against allowing FSI and market capitalisation to influence decisions at the expense of trust, describing them as distractions from building a lasting reputation.

He cited Prestige Group chairman Irfan Razak as an example of trust becoming a business asset, saying developers and landowners in Bengaluru approach him to resolve disputes because of his reputation. Abhishek also said real estate contributes around 7-8% to India’s GDP and has a wider employment impact through a supply chain covering around 400 industries. With India targeting a $25 trillion economy by 2047, he said the sector has room to expand its contribution. 

“The next 15 years are a golden time for our industry. We will create sales, we will create profit, we will create market cap, but most importantly, we will create trust. We are not just builders of buildings. We are builders of the nation’s fabric,” Abhishek noted.