India’s insolvency framework has helped more than 1.4 lakh homebuyers move closer to receiving possession of homes trapped in delayed real estate projects, as financially stronger developers step in to revive distressed developments, according to industry officials and analysts.
Major developers such as Adani Realty, Lodha and others have acquired or taken control of stalled projects through proceedings under the Insolvency and Bankruptcy Code (IBC). Their involvement has brought fresh funding, construction expertise and execution capacity to developments that had remained incomplete for years.
However, the scale of unresolved projects remains substantial. Around 2.5 lakh homebuyers are linked to 553 real estate insolvency cases admitted under the IBC. Only about 17% of these cases have been resolved, leaving nearly 1.1 lakh buyers associated with 221 cases still awaiting outcomes.
Projects resolved through the insolvency mechanism represent investments worth approximately ₹84,000 crore, while another ₹65,000 crore remains locked in projects yet to reach resolution.
Homebuyers were recognised as financial creditors under the IBC in 2018, giving them a stronger role in insolvency proceedings. The Insolvency and Bankruptcy Board of India has also proposed reforms focused on completing housing projects rather than liquidating them. These include project-specific insolvency processes, ring-fencing of project funds, simpler claims procedures and closer coordination between RERA authorities and insolvency courts.
Nikhil Bhatia, Managing Director – Land & Capital Markets, CBRE India, said, “Real estate resolutions under IBC are slower than most other sectors, and that’s structural. These are typically long-gestation projects with layered claims across homebuyers, lenders and land partners, and whoever steps in has to fund construction upfront while returns come later. It requires patient capital and a longer holding horizon than most balance sheets are set up for. Recently, the steady end-user demand and firmer pricing in the larger markets have made some stalled assets viable to complete again.”
Gulam Zia, International Partner and Senior Executive Director at Knight Frank, said, “The growing pool of distressed real estate under the IBC is creating an opportunity for financially stronger developers to expand through acquisitions.”
One prominent example is Mumbai’s Take Ten BKC project, where Adani Realty committed more than ₹1,000 crore for completion and has since delivered homes to 903 buyers.
Real estate expert Vishal Bhargava called NCLT a “boon for homebuyers trapped in stalled projects”, noting that heavyweight developers reviving distressed projects have helped restore buyer confidence.
Source: Economic Times Legal
