Ahmedabad : Commercial Real Estate Slumps as Investment Crashes Over 60%

Ahmedabad | Gujarat — Once projected as one of India’s fastest-growing real estate destinations, Gujarat’s property market—especially in Ahmedabad—appears to be staring at a prolonged slowdown, with fresh data revealing alarming stress in both residential and commercial segments.

A recent Gujarat-focused report published by Ahmedabad Mirror has already sent shockwaves by stating that nearly 89% of residential properties across the state remain unsold. What is now becoming equally evident is that the commercial real estate market is following a similar downward trajectory, particularly in Ahmedabad, long considered the state’s commercial nerve centre.

According to a news report, investment in Ahmedabad’s commercial real estate market has collapsed sharply over the past seven years. From a peak investment of Rs 8,871 crore in 2017-18, the figure has plunged to just Rs 3,394 crore in 2024-25, reflecting a steep decline of over 60%. The broader Gujarat market, though relatively better placed, has not been immune either. Statewide commercial real estate investment fell from Rs 19,353 crore in 2017-18 to Rs 12,152 crore in 2024-25, marking a significant contraction.

Real estate experts point out that while capital inflows are shrinking, unit registrations present a contradictory picture. Gujarat registered 31,520 commercial units in 2024-25, up from 25,235 units the previous year, indicating a 20% year-on-year increase. However, this growth appears to be driven largely by smaller-ticket transactions and fragmented developments rather than large-scale commercial investments.

Ahmedabad, in contrast, tells a more sobering story. Commercial unit registrations in the city declined by 1.4%, falling from 8,645 units to 8,523 units during the same period. “The city’s commercial real estate market has struggled to regain momentum after multiple shocks over the last decade,” said a senior real estate analyst tracking Gujarat markets. “The recovery phases have been short-lived and inconsistent.”

The data supports this assessment. Between 2017-18 and 2020-21, Ahmedabad’s commercial property registrations fell dramatically, with project registrations plunging by nearly 40% in 2020-21, while overall project costs dropped by more than 50%. A temporary recovery followed in 2021-22, when projects rose by 26.2% and unit registrations increased by 11.3%, but the optimism proved fleeting.

By 2022-23, the market slipped again, recording a 14.6% fall in projects and a 17.6% decline in investment value. Although 2023-24 saw a surprising 93% jump in project costs despite fewer projects, the momentum could not be sustained. In 2024-25, Ahmedabad once again saw a 10.7% decline in investment value and a 1.4% drop in unit registrations.

Project-level data further underlines the slowdown. Ahmedabad registered 193 commercial projects in 2017-18, which dropped to just 65 projects in 2020-21. Even in 2024-25, registrations recovered only marginally to 72 projects, far below earlier peaks.

Per-unit pricing trends reflect market volatility. From Rs 34 lakh per unit in 2017-18, prices fell to Rs 25 lakh in 2022-23, before surging to Rs 44 lakh in 2023-24. In 2024-25, prices have stabilised at around Rs 40 lakh, suggesting cautious buyer sentiment rather than renewed confidence.

Industry voices warn that unless demand revival, policy clarity, and investor confidence return simultaneously, Ahmedabad’s commercial real estate market may continue to underperform, even as smaller cities in Gujarat show relative resilience.