Real estate developers are finding it tough to get the right contractor for construction to ensure quality and timely delivery as the number of launches has doubled to approximately 1.25 lakh housing units across top seven cities every quarter from 60,000 before the Covid-19 pandemic.
Many developers are boosting in-house capabilities while some are getting global contractors to ensure there is no delay in project delivery, industry insiders told ET. Some are also engaging construction tech companies.
TARC Ltd recently appointed Abu Dhabi- headquartered Arabian Construction Company as the principal contractor for its luxury residential project TARC Kailasa in Central West Delhi and the upcoming TARC 63A in Gurgaon, while Trehan Iris said it is boosting in-house construction capabilities and partnering with global contractors.
“It has indeed become challenging for developers to get the right contractors for their new projects. The fact that there are numerous government infrastructure projects underway doesn’t help,” said Anuj Puri, chairman of real estate services provider Anarock Group. “Moreover, construction technology has also progressed rapidly. This poses another challenge in getting contractors who can build quality projects using the latest technology within stipulated timeframes,” he added.
According to Anarock data, 2.36 lakh housing units were launched in the top seven cities in 2019, which dipped to 1.27 lakh in 2020 largely due to Covid and increased again to 2.36 lakh in 2021. The number rose to 3.57 lakh in 2022 and reached a record high of 4.45 lakh units in 2023. This year, it is expected to breach the 5-lakh mark.
Industry body Confederation of Real Estate Developers Associations of India (Credai) said appropriately skilling workers and developing a regulatory framework for them is the key to improve quality and speed of construction.
“India is a labour-intensive country, and the long-term solution lies only in skilling the labour and not availing services of foreign contractors as the latter, at best, could be a temporary measure and not the long-term answer to skill shortage,” said Manoj Gaur, president of Credai-NCR and chairman and managing director of Gaurs Group.
Construction industry is the largest employer of unskilled labourers in the country.
“Many developers are now beefing up their in-house teams to have more control over projects,” said Shivkumar Borade, founder and managing director of construction tech startup Mytek Innovations. “This move allows them to maintain high standards and greater control over project execution, ensuring that sustainability goals are met without relying solely on external partners.”
A platform for contract manufacturing and projects, Mytek plans to raise $10 million from investors to triple its order book by FY25.
Ishaan Singh, director at Gurgaon-based real estate developer AIPL, said securing the right contractor has become increasingly challenging amid a surge in launches. “Builders are now more than ever focused on ensuring quality and timely delivery. It is crucial that the management is closely involved at every stage of the construction process to prevent delays and maintain the highest standards of quality,” he said.
Amar Sarin, managing director and CEO of TARC Ltd, said Arabian Construction Company with 50 years of experience is known for high quality developments and specialises in construction of high-rise buildings. “We want to bring the best consultants and engineers for our customers to deliver nothing less than the best,” he said.
Pralayesh Guha, VP – project at Trehan Iris, said, “By prioritising collaboration and transparency with our construction partners, we aim to set new benchmarks for quality and efficiency in the industry
