The Real Estate sector contributes between 5% and 10% to India’s GDP, either directly or indirectly and is one of the fastest growing segments in India. With the growth of the Indian industry, emergence of India as a global R&D center for companies and push for upgrading infrastructure facilities such as roads, ports, industrial parks and townships, real estate sector has come to occupy the centre-stage. This area has consequently attracted a lot of interest from foreign investors as well as market players interested in entering and consolidating this market. However, real estate sector is regulated by complex land law and regulatory mechanisms that require the assistance of experienced personnel to ensure success.
The laws relating to Foreign Direct Investments and External Commercial Borrowings (ECB) have undergone several changes and allows for entry in this sector via automatic route. However, a host of restrictions continues to apply for investments including those on ECB for working capital requirements and exclusions from investments in agricultural land, plantation, etc. These restrictions are critical and lot of circumspection and expertise are required to ensure the investments made in this area are proper and free from encumbrances.
Investment in real estate companies in India is also an attractive option. These companies in India have evolved from unstructured organizations to established entities over the years. Nevertheless, investments in these companies require extensive care and experienced support to ensure the investments are secure.
Registration and Title Verification
The land laws in India are a mixture of very old and new laws making the regime complex to navigate. Apart from Central Government laws, transactions involving land and real estate are also governed by state laws and agencies. Litigation relating to title and ownership rights is one of the most litigated areas in India. Proper registration of property rights in India is necessary to ensure compliance and to avoid title disputes.
The real estate team in L&S is experienced in handling all aspects of real estate transactions. Attorneys in L&S have handled structuring of FDI in this area, conducted comprehensive due diligence including provision of title verification and registration services. The team has knowledge of the local laws and procedures in various states in India including the environmental and regulatory laws affecting transactions.