Aerocities can boost economic growth and drive innovation

India is the third largest aviation market after the United States and China. The country has around 140 domestic airports alongside 50 international airports.

Last year, its air passengers’footfall touched 150 million, which is now expected to double by 2030. In addition to a vibrant airport infrastructure, India is also developing 100 new regional smaller airports and airstrips to complement the existing aviation market under the UDAN scheme. Likewise, it is working on 50 new Greenfield airports, while, simultaneously expanding the existing ones. As per Boeing projections, the country will require 2400 new aircraft by 2041, which is around 90 per cent of the market demand in the entire South Asian region.

India’s aviation industry has experienced significant growth in the past 10 years. The number of operational airports has doubled from 74 in 2014 to 157 in 2024 and the aim is to increase it to 350-400 by 2047. The domestic air passengers have more than doubled in the past decade, with most airlines significantly expanding their fleet.

Aerocities are specialized urban areas designed to support airport operations and the aviation industry. They provide essential infrastructure for aviation activities, enhance connectivity with transportation links, and create commercial hubs to serve travellers and businesses. These integrated complexes typically include a range of facilities such as office spaces, logistics hubs, retail areas, and residential units, all strategically designed to fully utilise their close location to the airport. The importance of aerocities lies in their ability to enhance economic growth by attracting global businesses, facilitating efficient cargo and passenger transport, and creating a dynamic environment that supports innovation and connectivity. By leveraging the strategic location near major air transport hubs, aerocities contribute significantly to regional development and international trade.

India currently has nine Aerocity projects sprawling over 14,000 acres of land. Close to 22 per cent or 3050 acres of Aerocity land is operational in aerocities, including Delhi, Hyderabad, Mohali and Durgapur. Around 18 per cent or 2585 acres is under development and is expected to enter the market supply soon. Some of the under-construction projects include 150 acres near the newly-inaugurated Valmiki International Airport in Ayodhya, a 463-acre mixed-use project near DevanahalliAirport, and a 172-acre project near Jewar Airport, which is slated to open soon. Work is progressing rapidly on the 740-acre project near the Navi Mumbai International Airport, being jointly developed by AdaniandCIDCO. Airport-linked aerocities are strategically situated adjacent to major airports to capitalize on their connectivity advantages. These developments focus on creating a seamless transition from the airport to the surrounding urban areas. By integrating a mix of commercial spaces, including office buildings and business parks, with high-quality hospitality services such as hotels and serviced apartments, these aerocities cater to both business travellers and tourists.

The design prioritises efficient transportation infrastructure, including direct access roads and public transport links, to enhance convenience for users and foster a dynamic business environment. The aim is to leverage the airport’s strategic location to drive economic activity and provide comprehensive services that benefit both businesses and travellers.

Aerocities are also a bustling ground for the hospitality industry, with a growing concentration of luxury hotels, upscale hotels, corporate guest houses, long-term rental projects, and serviced apartments. According to data from 360 Realtors, total branded rooms in aerocities are pegged at around 5500. By 2030, this is expected to approximately be 12,000, growing at a compound annual growth rate (CAGR) of 16.9 per cent. Delhi Aerocity alone boasts of around 4,000 rooms with an extensive pipeline of about 3,000 additional rooms. In Bangalore Aerocity, there is a pipeline of approximately 2,500 rooms. A 290-room Novotel hotel is operational in Hyderabad Aerocity and Boston Living is building a 1500-bed premium co-living space in the region. Once completed, this will be one of the largest real estate projects in India. Aerocities represent a new era of urban development in India. Their strategic location, modern infrastructure, and comprehensive urban planning make them attractive to businesses, residents, and investors alike.

As these projects continue to develop and expand, they are set to play a crucial role in shaping the future of Indian cities and the real estate market. The success of aerocities can serve as a model for other urban development projects, driving growth and innovation across the country.

As the sector embraces greener practices like carbon-neutral airports and solar energy adoption, the future of aviation in India promises not only continued growth but also a commitment to sustainability, ensuring long-term benefits for the nation and the environment.