The technology-supported innovative solutions ensure that projects, regardless of the developer’s size, are monitored to meet institutional investor standards, opening new financing avenues for mid-sized developers.
“Technology is playing a pivotal role in reshaping capital allocation in the Indian real estate sector. By reducing risks, enhancing transparency, and improving operational efficiency, these advancements are not only opening up new opportunities for mid-sized developers but also contributing to a healthier, more sustainable industry,” Dosti Realty chairman and managing director Deepak Goradia said.
In the property sector, funding was so far predominantly directed towards a select group of developers largely due to the comfort and trust institutional investors had developed in them led by their execution track record and reputation.
“One of the key benefits of these technologies is the ability to generate accurate cash flow projections and profitability reports. This allows investors to assess the financial health of a project more effectively and take pre-emptive action if any potential issues are identified,” said Sangram Baviskar, MD, real estate practice at TruBoard Partners, a tech-enabled asset management platform.
According to him, AI-powered sales analysis tools compare actual sales data against business plans, using historical trends and market information to predict future sales with a high degree of accuracy. This provides investors with a clearer understanding of a project’s potential returns, reducing the perceived risk associated with mid-sized developers.“Mid-sized developers, despite having viable and promising projects, often struggled to secure funding due to the perceived risks associated with their smaller scale and less-established market presence,” said Ramashrya Yadav, founder and chief executive of Integrow Asset Management, which has an in-house realty-focused monitoring platform, Arjava.According to him, this concentration of capital had implications for the industry as it limited the diversity of projects that could be developed. It also constrained the growth potential of mid-sized developers.
Technological advancements are now democratising the flow of capital, providing opportunities for mid-sized developers to access funding that was previously out of reach.
AI-based project monitoring systems are enabling investors to get real-time, data-driven insights into project performance.
These systems offer comprehensive tracking of project costs, physical progress and future expenses, allowing investors to monitor projects closely and ensure they are on track, experts said.
Beyond improving investor confidence, these technologies are also driving efficiency and cost reduction in project management.
Traditional project monitoring methods, which could account for 7-8% of construction costs, are being replaced by AI-based solutions that reduce these costs to as low as 4%. This not only enhances profit margins but also ensures more timely and accurate monitoring, helping prevent projects from becoming stressed assets, Baviskar of TruBoard Partners said.
Digitisation is another critical factor in this transformation. By automating key processes such as home buyer NOC issuance, project expense approvals and covenant monitoring, these technologies eliminate the need for manual processes that are prone to human error.
These solutions speed up project timelines along with increased transparency, enabling stakeholders to receive immediate updates and make timely interventions when necessary.