Affordable homes in next one year

NARDECO (the National Real Estate Development Council), the umbrella developer body was formed under the ruling of Ministry of Housing and Urban Poverty with an objective to alleviate the work of central government. Niranjan Hiranandani, MD of Hiranandani Constructions Pvt. Ltd is now act as the president of Maharashtra NARDECO unit.

The National Real Estate Development Council has decided to construct one lakh affordable homes on the basis of no-loss no-profit. However; with this condition government has to provide land for the construction of homes. Niranjan Hiranandani, President of Maharashtra NARDECO unit stated that soon we will meet Chief Minister Devendra Fadnavis with detailed plan of action for the construction of affordable homes. Apart from that he also ensured that over one lakh affordable and low-cost houses to be built each and every years for the next five years in MMR (Mumbai Metropolitan Region) in sync with the government of Maharashtra. The more he added that “It will ensure the delivery of best possible technology at lowest possible cost. However; the allotment of the housing units will be based on the certain criteria and lottery system.

“If state government will provide land for such developments, so we will be able to construct home in Mumbai too. We want to earn good name and reputation in all over country. We want to show that this initiative aim to complete the dream of people, which is to own home in Mumbai. After throwing this idea now many real estate developers are coming forward and taking their responsibility to build certain number of houses” said Hiranandani.

Few Builders have different strategy:

According to Pankaj Kapoor, MD, Liases Foras, the real estate research firm, “In Mumbai real estate developers will never construct affordable home, no matter you provide them land or not. Because; first thing; Why we need real estate developers to construct affordable homes at government land? Government needs contractors to construct homes rather than the developers, apart from that urban bodies such as; CIDCO and MHADA should stop their habit to sell land in the open market rather use them for the construction of houses only”.

Image Credits: DNA

The MMRDA (Mumbai Metropolitan Region Development Authority) is all set to process the auction of land in BKC (Bandra-Kurla Complex) with an aim to fund its some of infrastructure projects.

In past MMRDA has funded many infrastructure projects by selling different land parcels, but after 2007 its fist time when MMRDA decided to invite bids to fund its infrastructure projects. According to spokesperson of MMRDA, “We intend to sell 21,807 sq mtrs of residential space in G block (north) of BKC and 12,500 sq mtrs of commercial space in G block of BKC. MMRDA has decided to appoint consultants for the valuation and documents preparation in the process of bidding”. In Mumbai, the FSI (floor space index) for commercial and residential space is 4 and 3 respectively.

It is expected that in next few months consultant will prepare the whole road map for bidding invitation and rest of the process. According to one of the MMRDA official, “We hope that auction will start at the beginning of second quarter of 2016. We expect that we will get rate of Rs 4 to 5 lakh per sq mtrs, however; it also depends on the available built-up area, as there are more restrictions, due to which we have sought relaxation”.

MMRDA is planning to lay 118km of Metro lines with the cost of Rs 35,000 crore and MMRDA has already sanctioned work for Dahisar (Rs 5,566 cr) to DN Nagar Metro; Phase I, Metro II (Rs 4,737 cr) and Dahisar-East to Andheri-East Metro VII corridor. It will also have the pride for MMRDA to fund Rs 23,136 cr for Metro III or Colaba-Bandra-Seepz and its proposed extension between Kanjurmar-Seepz, which will cost around Rs 1,700 cr. However; it is expected that for Metro III it will get the bank loan for 88 per cent of the total cost from Japan International Cooperation Agency.

According to officials, “From many years we did not sell land because of downturn in the market, but now scenario is getting better and we need funds for crucial and most important projects. Earlier, MMRDA had tried to sell land with the rate of Rs 3 lakh per sq mtrs, but many felt that price was too high in 2010”.

Ghodbunder Road – upcoming destination

From a small suburban town on the outskirts of Mumbai to a self-sustaining metropolis, Thane has progressed leaps and bounds over the last decade. It is a modern city with expansive flyovers, seamless highways and broad roads that contribute to its burgeoning social infrastructure.

With a property price boom that was seen in areas in and around Mumbai between 2010 and 2012, Ghodbunder Road segment in Thane emerged as an ideal residential destination for price-sensitive home buyers owing to the relatively lower rates in comparison to the central Thane city. Today, Ghodbunder Road is witnessing rapid appreciation in terms of real estate.

Ghodbunder Road is approximately 20 km long and links the two main arterial roads of Mumbai, the Eastern Express Highway which starts at Sion and terminates at Thane and the Western Express Highway, that starts at Bandra (East) which becomes the National Highway leading to Gujarat. Many rail and road infrastructural projects on the Ghodbunder Road are in the pipeline giving the area an upper edge.

The MMRDA has given a nod to a monorail network which will serve as a feeder system to the Metro corridor extending from Wadala to Kasarvadavali on Ghodbunder Road. Besides, the road also provides quick accessibility to Mira Road from Thane, and to other micro-markets like Mulund, Bhandup and Ghatkopar.

From affordable apartments to premium properties, the area offers an extensive mixture of housing options. Capital values of newly launched multi-storey apartments vary between Rs 40 lakh to Rs 2.5 crore and the average prices of this region range between Rs 8,000 and Rs 10,000 per sq ft with annual appreciation of nearly 7-10 per cent, based on the project specifications and amenities.

Ghodbunder Road is attractive to developers primarily due to the easy availability of large land parcels. Some of the reputed developers present on this stretch are Runwal Group, Puraniks Builder, Harmony Lifestyles Group, Vijay Group, Rosa Group and DS Group.

Mumbai Metro

Phase 1 of the Mumbai Metro which runs from Ghatkopar to Andheri has resulted in a substantial improvement in the realty development along the metro route and areas close to metro stations due to east-west connectivity within the city saving office goers precious time of commuting to-fro work.

As there was no direct link earlier, this metro route has come as a blessing for commuters by taking the load off the existing road and rail infrastructure. This decongestion has attracted buyers who were hitherto hesitant to buy residential or commercial spaces in these areas. Places like Chandivali and Sakinaka in Andheri (east) are easily accessible now. “The demand for both residential & commercial property is heading northward due to the Mumbai Metro,” says Manju Yagnik, vice-chairperson, Nahar Group.

Experts believe that infrastructure development acts as a catalyst that boosts residential and commercial property segments. In this context, the Phase -1 of the Mumbai

Metro has played a crucial role. Considering the pivotal function of rail infrastructure development in the city, Maharashtra chief minister and chairman, MMRDA, Devendra Phadnavis  has sanctioned an outlay of Rs 35,400 crore for the development of 118-kms Metro network in Mumbai alone.

The network includes a 40-kms Dahisar-CharkopBandra-Mankhurd Metro-2 corridor (Rs 12,000 crore), 40-kms Wadala-Ghatkopar-Thane-Kasarvadavali Metro-4 corridor Rs 12,000 crore), 27-kms Dahisar-E-AndheriE-Bandra-E Metro-5 corridor (Rs 8,100 crore) and 11-kms Jogeshwari-Vikhroli Link Road Metro-6 corridor (Rs 3,300 crore).

All these Metro projects will certainly draw property consumers to adjoining areas due to resultant enhanced connectivity. Infrastructural proposals have always contributed to the real estate boom in the city and Nishant Agarwal, managing director, Avighna, believes that the future infrastructure plans like the new metro routes will also continue to fuel growth in the real estate sector.

Property prices in the neighboring areas of the metro rise significantly once the project gets on track. Ramesh Nair, COO business and international director, JLL India, points out that the areas near Ghatkopar-Andheri Metro line have already seen a price rise of nearly 400 percent over the last eight years. A similar trend may continue with the announcement of the new metro corridors in the city.

BKC Area

As per the response to an RTI query, Mumbai Metropolitan Region Development Authority (MMRDA) would levy additional premium charges on Reliance Industries Ltd. (RIL) a company led by Mukesh Ambani for delay in development of a joint property in the posh BKC area. The amount of penalty would be Rs.341 crore for failing to develop the plot C 66 in the G-Block of BKC as a commercial building with car park within a stipulated period of four years. MMRDA informed that the amount has been due for the last 34 months.

An RTI activist Anil Galgali had filed a query with MMRDA wherein he sought details of the plot of the new business district in the central part of the megapolis. MMRDA said that plot No C-66, ad-measuring 10183.18 square metres, was leased to RIL on September 27, 2008 for Rs 918.03 crore and allowed development of 30,550 square metres of commercial space and 20,366 square metres for public parking. The RTI reply was furnished by an official of the Town Planning Division.

When RIL spokesperson was contacted, he informed that the construction is now almost complete except some final touches but blamed Raghuleela Builders Pvt. Ltd. (the developer) for the delay in construction. The developer has a tripartite agreement with MMRDA and RIL for development of the property.

RIL also argued that the delay in payment should not be termed as ‘default’ because as per the request for proposal (RFP), the developer can make the payment along with interest till the time he seeks occupation certificate (OC) or before the final completion certificate is granted. This is duly permitted by the MMRDA.

Besides One BKC, Reliance Industries is also building a huge convention centre in the business district, where it has developed a public park named “Jio Park” and was recently dedicated to the city.
Meanwhile, Galgali has demanded that MMRDA should issue a stop-work notice to RIL immediately and recover the additional premium first with interest and penalty. He said that he has written a letter to MAHA-CM Devendra Fadnavis as well as Metropolitan Commissioner U P S Madan over this blatant violation of rules and has demanded strict action against RIL.

There was no response to the query from Dilip Kawathkar, Joint director for projects at MMRDA.

Kalyan based real estate developer moved to Bombay HC

A one of the Top most Real Estate Developer from Kalyan, Mumbai where construction is on its boom in recent years, has moved to Bombay High Court to get the permission to continue with few of the new residential and commercial projects . In present, Bombay HC has put the stay on all the new construction in Kalyan area.

On April 13, 2015 the Bombay HC had put the stay on new construction permission, until local Municipal Corporation clears the issue of solid waste management which is pending from very long time. On the hearing of PIL, which were filled by KD Gokhale and few others in Bombay HC in the year 2009, to highlight the plan to setup a solid waste management treatment plan for 15 years. In the process of hearing, a bench of Justice V L Achliya and Justice N H Patil ordered the MPCB (Maharashtra Pollution Control Board) to bring the civic officials to book and get the KDMC (Kalyan Dombivli Muncipal Corportaion) and MMRDA on one platform to resolve the issue of solid waste management.

However; the Tycoons Avanti Projects LLP, and its partner Shrikant D Shitole, sought to intervene the whole hearing procedure in the PIL which was scheduled on Tuesday. S D Shitole, who is the real estate developer in the fastest growing Kalyan region from last 14 years, pointed out that Bombay HC is in effect by putting the whole development process and end users in the limbo without any fault. The plea is all about to direct the KMDC to consider his application which was submitted on the date October 2104 on merits and issue of commencement of certification.

A projects at Godrej Hill is about to complete, the his plea added that one more redevelopment agreement with Chikanghar Shantidhoot Co orerative Society for the low and middle class income group is ready to pay the stamp duty of Rs. 1.6 crore and it is pending while it is situated just opposite to Birla College where more than 180 tenants had been shifted in last two years of duration. Whereas; for another project Shitole stated that he paid more than Rs. 33.44 crore FSI as premium to MHADA in the month of November 2014. Bombay HC, stated that “Urbanization calls for a planned approach”.

According to recent data of real estate sector it’s clear that KDMC is an upcoming urban area in Mumbai. If corporation will continue to sanction the construction projects in the area without any impact assessments surveys, so it would be the additional burden on current infrastructure which is well develop and suitable for current situation, the bench of Justice said. However; the garbage waste is bound to increase as per the increase in the projects of construction. And it’s the duty of municipal authorities to make and change the necessary changes in infrastructure to get all the desired civic amenities which is available for their citizens. There should be an action plan chalked out by the authorities of corporation as we have noticed that issue has not been taken seriously by appreciate authorities and it shows that how a grim situation has emerged today.

Indu Mills to build a memorial for Dr B R Ambedkar

The state government of Maharashtra is planning to grant heritage TDR (transfer of development rights) to the Government of India, for permitting the use of Indu Mills to build a memorial for Dr B R Ambedkar. The Indu Mills is spread on an area of 12.5 acres in Dadar, which is owned by the NTC (National Textiles Corporation). Officials of UDD (Urban Development Department) stated, “The land will be included in the city’s heritage and after the TDR it will be a national heritage site. Indu Mills was excluded from the BMC’s proposed heritage list. Heritage list of 2012 is yet to be finalized as currently BMC is facing the opposition from stakeholders in that list

The National Textiles Corporation has demanded a compensation of Rs 3,600 crore for the land because according them they had been sanctioned a 5-star hotel on an adjoining plot, which was granted by CM Ashok Chavan, but later it was cancelled by Prithviraj Chavan. On Monday, the state urban development department issued a notification with its intentions to modify regulation 67 that deals with heritage TDR. It is expected that it will compensate the loss of development rights due to restrictions imposed when a building or land is included in the heritage list.

Heritage TDR can be used in certain wards, especially where it is generated and it has higher premium as very little of it is generated. But still NTC can sell it to other developers or use it for construction, According to price of 2012, it is estimated that the mill plot will cost around Rs. 4,000 crore. According to Architect Neera Adarkar, Indu Mills had been selected, but in later decision subsequent committee excluded it, Neera was part of a committee, which prepared the list of heritage sites for NTC. According to Regulation 67 of the development control regulations allows heritage TDR to land-owners whose structures have been declared heritage structures. As per reports, there is no clarity on whether the state or central government is entitled to TDR, so we are amending the regulation to include the state and central governments as beneficiaries. The provision of heritage TDR is a condition, which set by the Union government to move a bill in Parliament to get Indu Mills from NTC, said by the officials of Urban development department.

It is expected that the TDR will be handed over to NTC in the form of compensation and the United Progressive Alliance government is ready to hand over the land to the state government for the memorial. In July 2014, MMRDA was appointed the special planning authority for the conceptual plans on memorial, 13 firms had responded in which two were international firms known as; Jakob-MacFarlane (France) and UDP International (Hong Kong). MMRDA (Mumbai Metropolitan Region Development Authority) is working on the design of memorial.

Girni Kamgar, Sanghatana and Datta Iswalkar questioned the logic of granting TDR to the central government. The land belongs to the Centre Government and Ambedkar had contributed immensely to the country, but the construction will be restricted as the land plot comes under the coastal regulation zone.

Redevelopment projects

After facing a lot of opposition from real estate developers, the state government is implemented the affordable housing policy in city, which stipulated that certain portion of the plots will be kept to build low-cost homes free of cost.

This amendment was proposed by the urban development department by stating that real estate builders no longer have to carve out more than 20 per cent of their plots for public housing. Instead of that they can construct the cheaper tenements anywhere within the same administrative ward to cater the need of affordable housing in the city. But Housing experts questioned, the move is pointing out not many builders have plots in the same ward. . “Will developers be forced to buy another plot to construct these tenements?” asked industry insiders. In notice it was issued on Monday that, the government offered 50% free floor space index (FSI) to all real estate developers to build tenements on alternative plots in the same ward.

But real estate builder are in the mood to oppose this move because the Slum Rehabilitation Authority (SRA) provision already allows them to provide tenements in faraway wards. The mandatory 20 per cent affordable housing scheme will also apply on housing society redevelopment projects where the existing flats are less than 600 sq ft. If the existing flats are on the area more than 600sq ft, so real estate builders have to construct the additional tenements but need not hand them over to the state housing authority, Mhada. “It will be constructing either in a separate block or in a separate wing in the same building and allotted to the housing society for use as ‘service quarters’,” indicated the notice. This may complicate the certain things, as it will lead to tussles among housing society members on who should be allotted these tenements,” stated by the member of a housing society. So the department has proposed a 300 per cent premium on the “applicable rate” to be paid by the society if these service quarters are sold to outsiders.

The state government has clarified that 20 per cent for affordable housing will not be applicable to redevelopment projects for old and dilapidated buildings, clusters, slums, Mhada colonies and on defunct industry land. In these schemes more than 20 per cent of the basic zonal FSI is already utilized for low cost housing, it said. In Mumbai lack of affordable housing has reached to a crisis point as public agencies such as; Mhada able to build around 2.8 lakh tenements in the past 15 years. In past two decades SRA has provided 1.6 lakh tenements, a report released by NGO Praja in December 2014, showed that different public agencies such as; MMRDA, Mhada and SRA have been able to provide around 3.1 lakh homes between 1995 and 2014, of which 1.1 lakh tenements are still under construction.

Neera Adarkar, a architect and urban researcher stated that an average salaried person can no longer afford to buy a home in Mumbai. “A few years before during recession, when real estate developers could not sell their luxury apartments, they divided them into four parts and started selling homes of 500 sq ft each. This is not what affordable housing is about,” she said. In 2013, the report by Knight Frank (a global realty consultancy, listed Mumbai) indicated that the most unaffordable housing market in the country with 29 per cent of its under-construction dwelling units exceeding the Rs 1crore mark. We all know that in Mumbai the relentless price rise and higher concentration of premium projects had limited the purchasing ability of home buyers, it added.

Pankaj Kapoor, who is a property researcher in farm Liases Foras, stated that, “Affordable homes are only available 50km away from Mumbai, but even in these far-flung regions, 60 per cent to 70 per cent of the homes or flats or apartments have been sold to investors and not to the end-users”

Ready apartments in Thane

Thane Ghodbunder Road residential area comes as welcome news for the flat buyers who feel that realty in Mumbai is overly priced.

In near future, Ghodbunder Road is going to rival Andheri, Powai and Goregaon as far as the real estate is concerned given that Wadala-Ghodbunder road metro connectivity is going to be stretched all the way.

The area is going to witness project deliveries of more than 40 per cent projects active in the area. There are 65 active projects in the locality out of which over 20 will be giving possession in the next by the end of the year. “Ready stock is pushing up the demand in Ghodbunder Road. This stock offers properties in varied budget ranges of Rs 40 lakh to Rs 1 crore,” says Anand Patil, proprietor, Oceanic Realtors.

“Availability of comparatively affordable new property options makes the locality an attractive investment hub for young buyers aged between 27-35 years,” informs Patil. Apart from this, sentiments also improved as the Wadala-Thane Metro is expected to get funding from the World Bank.

Ghodbunder Road has entered the top 10 list of the most preferred localities for purchase, as per the real estate watchers.  The area is listed on the ninth spot and shares space with some top localities of Mumbai such as Andheri East and West, Powai and Goregaon.

As per the data, a 1BHK of 500-600 sq ft is available for Rs 50 to 64 lakh while a slightly larger apartment of 800 sq ft is offered for Rs 95 lakh. GB Road also has multiple 3BHK options available in a higher price bracket of Rs 1.8 crore to Rs 2.5 crore.

Areas along the Ghodbunder road like Manpada offers a 500 sq ft 1BHK apartment at a starting price of Rs 60 lakh, while Pokhran Road offers a similar size apartment in a budget range of Rs 68-74 lakh. Similarly, Mulund East offers smaller properties at Rs 90 lakh to Rs 1.2 crore for a 700 sq ft property.

Brahmand, Kasarvadavali, Hiranandani, Vijay Nagari are popular residential colonies along the Ghodbunder road. As per the Mumbai Metropolitan Region Development Authority (MMRDA) plan, all these localities will be having a metro station in the vicinity and would have direct connectivity to South Mumbai as well as to Thane’s Teen Hath Naaka. The metro connectivity is expected to boost real estate prices further in the area.

Residential Properties in Thane

Property Price in thane

Real estate development across Eastern suburbs

Eastern Mumbai suburbs are among of the fastest growing residential centres in Mumbai metropolitan region. This area is advantageously located in proximity to other industrial sub-markets such as Bhiwandi, Badlapur, and Dombivli-Kalyan. Situated in Mumbai Metropolitan Region, these eastern suburbs have attracted a lot of heavy investments from established builders and developers.

The Mumbai Metropolitan Regional Development (MMRDA) authority has developed several residential zones that have led to this sub-market’s emergence as a major residential hub. The demand for homes from workers employed in these industries is therefore considerable and constantly rising. This provides eastern suburbs with all the attributes of an ideal real estate investment market, offering low entry points and high appreciation potential. Developers have already acquired large land parcels in eastern suburbs, while others are actively seeking such parcels for development. Some residential projects by elite developers have already been launched. This sub-market has especially high potential for integrated township projects and affordable housing undertakings. The eastern suburbs will continue to attract demand from the large existing workforce as well as additional manpower that will migrate there over the course of the next few years. The government of Maharashtra has already extended the jurisdiction of the MMRDA for the eastern suburbs up to Kasara and Karjat. The planned infrastructural initiatives in this region will further aid the emergence of these suburbs as a major real estate growth node. There are plans to set up a cargo airport, with industrial firms from abroad showing keen interest in establishing their manufacturing facilities in the area. With industrial growth acting as a pull factor for this sub-market, real estate development across the eastern suburbs’ various segments will find increasing traction going forward. The real estate story has just begun for Mumbai’s eastern suburbs. Residential prices in these areas are already up and give every indication of healthy rise in the future. This is a market that is especially appealing for large plot investments, and long-term investors who value the success formula of its unique combination of growth drivers.