Real Estate Value Chain is a concept that is being neglected by almost everyone in this sector. This document tries to throw some light on this concept.

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Understanding reality in RealT – Generic
Real Estate Value Chain
As soon as I sat down to pen the first post for RealT Horizon, I was bombarded with several areas of
concern which need to be addressed here. To start with, I decided to go with the basics. So let’s look at
the overview of the Value Chain of this sector.
Real Estate Value Chain mainly comprises of 5 broad levels:
Figure 1: Broad levels of Real Estate Value Chain
These 5 steps more-or-less comprise all the possible activities that one can associate with the
development and transaction of a property. Of course some of the blocks shown above do interchange
their positions sometimes, depending on the usage category. I will try to touch on that aspect later, or in
the following posts. But before that, the usage categories:

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Whether the 5 levels shown in figure 1 will remain intact or some of them will get merged or eliminated
depends totally on the 3 usage categories. If, for instance, the category is ‘Residential’ and that too for
single housing, probably the ‘Transactions’ level can be skipped.
Let me dig a little deeper in the value chain. If expanded, the chain will take the following shape:
Figure 2: Detailed Generic Real Estate Value Chain
As can be seen in the above figure, each level can be further fragmented into several components. This
is the multiplicity that results in all the complexities that this sector is facing currently in India and
probably in various other developing nations.
This sector needs treatment, and it will be possible only if there is a subtle understanding of its basics in
all the investors. I will cover all the components individually in my future posts. So stay tuned and pour
in your comments & suggestions to help me analyze RealT Sector more effectively!
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