Developer News
Shriram Properties Cautious on Commercial Expansion Amid AI and Work-From-Home Uncertainty
On October 3, 2026, Shriram Properties said uncertainty about AI's effect on office demand, and the continuing impact of work-from-home, were making it cautious about expanding its commercial portfolio. The company said residential development stays its main focus, with Chennai a key part of its three-year plans.
| Date of remarks | October 3, 2026 (media briefing, Chennai) |
|---|---|
| Speaker | M. Murali, Chairman and Managing Director |
| Chennai residential pipeline | 4.95 million sq. ft. (2.25 million sq. ft. under development; 2.70 million sq. ft. upcoming) |
| Office share of total development | Around 10% |
| Chennai development potential to be added over next three years | 3.3 million sq. ft. |
| Planned Chennai land acquisitions | Investment of approx. Rs 368 crore; targeted gross development value of approx. Rs 3,089 crore |
| Chennai sales target (next three years) | More than Rs 2,100 crore, around 3.84 million sq. ft. |
| Projected Chennai revenue, FY2026-27 to FY2029-30 | Approx. Rs 3,300 crore |
| Company-wide pre-sales target (next three years) | Rs 4,500–5,000 crore, up from about Rs 2,300 crore |
| Company-wide revenue and profit targets (next three years) | Revenue Rs 2,700–3,000 crore (from about Rs 1,000 crore); profit Rs 250–270 crore (from Rs 60–70 crore) |
What the company said
On October 3, 2026, Shriram Properties said it was cautious about expanding its commercial real-estate portfolio. The reasons it gave were uncertainty about how AI will affect office demand and the continuing effect of work-from-home on office space.
The comments were made by M. Murali, the company's Chairman and Managing Director, at a media briefing in Chennai. Murali said: “We don’t know what AI is going to do.”
Office space makes up around 10% of the company's total development, according to the figures reported. Shriram Properties is not currently in industrial real estate or active in warehousing. Murali described warehousing as a potentially significant opportunity, but the company has not announced entry into it.
Chennai plans and targets
The company's Chennai residential pipeline stands at 4.95 million sq. ft., made up of 2.25 million sq. ft. under development and 2.70 million sq. ft. upcoming.
Over the next three years, Shriram Properties plans to add 3.3 million sq. ft. of development potential in Chennai. The planned land acquisitions are associated with investment of approximately Rs 368 crore and targeted gross development value of approximately Rs 3,089 crore.
The company targets Chennai sales of more than Rs 2,100 crore, representing around 3.84 million sq. ft., over the same period. Projected revenue from Chennai is approximately Rs 3,300 crore over FY2026-27 to FY2029-30.
The company also expects to hand over more than 500 units in Chennai by the end of FY2027, with expected sales value of around Rs 250 crore.
Construction costs and affordability
Murali said construction-cost escalation is a challenge and linked the increase in costs to the war. He named cost pressure on oil-linked inputs including lifts, glass, sanitary products and tiles.
He said the company could not pass the full increase on to customers because of affordability concerns. In his view, the cost increase cannot be fully recovered through prices without weakening demand among buyers.
On technology, Murali said robots are being used for painting and robotic tiling is being evaluated. He said higher upfront costs make the technology hard to justify on one project, and that wider deployment across multiple projects could make it viable.
Demand outlook
Murali said the company will keep residential development as its major focus. He said he believes housing demand is increasing and does not expect it to decline, citing the importance of homeownership to Indian families.
He expects the second half of the year to be stronger for housing demand, particularly around the festive period through February.
Company-wide targets and scale
Across all cities, the company targets pre-sales of around Rs 4,500–5,000 crore over the next three years, up from about Rs 2,300 crore. It aims to raise revenue from around Rs 1,000 crore to Rs 2,700–3,000 crore, and profit from Rs 60–70 crore to Rs 250–270 crore, over the same period.
The company says it began operations in Bengaluru in 2000. It operates in Bengaluru, Chennai, Coimbatore, Visakhapatnam and Kolkata, and has also entered Pune. It describes itself as a residential developer focused mainly on mid-market and mid-market-premium housing, with a presence in plotted development.
As of April 30, 2026, the company reported 51 delivered projects covering 31.5 million sq. ft., and a pipeline of 41 projects covering 35.3 million sq. ft.
What it means for buyers, investors and the market
For buyers: The company has said it cannot pass all construction-cost increases to customers. That is a statement of intent about pricing, not a published price change. No new price sheets are part of the reported announcement.
For investors: The company is shifting its stated focus toward housing and away from commercial growth for now. Its three-year plans depend on land acquisitions, sales and cost control in Chennai, and on a sharp rise in pre-sales from the previous level.
For the market: The comments point to a developer weighing the office market's future demand against rising input costs. The company's plans assume housing demand holds up.
What happens next
- Over the next three years, Shriram Properties plans to add 3.3 million sq. ft. of development potential in Chennai and target more than Rs 2,100 crore in Chennai sales.
- The company expects to hand over more than 500 units by the end of FY2027.
- It plans to deepen its presence in Bengaluru, Chennai, Pune and Kolkata rather than immediately expand into new cities.
- Its three-year company-wide targets are pre-sales of Rs 4,500–5,000 crore, revenue of Rs 2,700–3,000 crore and profit of Rs 250–270 crore.
The company's official press-release listing also includes earlier Chennai announcements: a February 10, 2025 joint development agreement for a Chennai land parcel, and a December 30, 2024 sale of mall land in Chennai. Its site lists Codename King Life in Koyambedu, Chennai, as a new launch.
Frequently asked questions
Is Shriram Properties stopping commercial development?
The company said it is cautious about expanding its commercial portfolio. It did not say it is stopping commercial development. Office space makes up around 10% of its total development, and Murali said residential development will remain the main focus.
Why is the company cautious about offices?
Murali cited uncertainty about how AI will affect office demand, and the continuing impact of work-from-home. He said, “We don’t know what AI is going to do.”
Will housing prices in Chennai rise because of costs?
The company said construction costs have risen, linked by Murali to the war, and that it cannot pass the full increase to customers because of affordability concerns. No specific price change was reported in the source material.
Is Shriram Properties entering warehousing or industrial real estate?
Not currently. The company says it is not in industrial real estate or active in warehousing. Murali described warehousing as a potentially significant opportunity, but no entry plan was announced.
How much new development is planned in Chennai?
The company plans to add 3.3 million sq. ft. of development potential in Chennai over the next three years, with planned land acquisitions associated with investment of approximately Rs 368 crore.