The water crisis that has engulfed Chennai has led to slowing down of construction activity and could eventually result in a six-to-nine month project delay, say real estate experts.
Poor water management, despite warnings by satellite images, is believed to be the main reason for this crisis.
Water scarcity is bound to impact residents and economic activity, including real estate.
Construction is a water-intensive industry. An estimate by a global consultancy states that one lakh sq ft of construction consumes over 9,000 million litres of water. This quantity is enough to cater to the water requirements of 50 households for a year.
Chennai’s water crisis has impacted the construction industry. The only way developers can meet their requirement is through private water suppliers, who in turn have increased prices. This has impacted the cost of construction and resulted in a six-to-nine month delay in project deliveries, says Mudassir Zaidi, Executive Director – North, Knight Frank, adding such delays will significantly impede the already stressed real estate market.
The supply starved office market will probably take the biggest hit as the much-needed new buildings slated for a 2021-22 launch will not be able to meet their delivery timelines, he says.
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