Property Rates Will Rise Due Ready reckoner rates increase

MUMBAI: Home buyers in Mumbai will pay more for their dream home after a cash-strapped Maharashtra government sharply increased government rates used to calculate taxes paid by consumers when purchasing property. 

Ready reckoner rates, as they are called, have been increased by 30-40% in case of some fastest growing, popular suburbs in the city triggering protests by builders, consumers and unease among the members of the ruling BJP-Sena alliance which captured power in the state after a 15-year break. The hike, which is effective from January 1, could make property expensive and will most likely dampen hopes of home buyers waiting for a fall in property prices after years of dizzying climb. It will also make it difficult for builders who are eager to draw buyers and get rid off an increasingly bloated inventory 

Posh residential localities such as Worli, Bandra-Kurla complex, the city's fastest-growing commercial complex and home to someof the country's biggest financial institutions, are among the places where rates have been increased by 30-40%. Rates in popular suburbs such as Goregaon, Borivali, Malad, Chembur, Ghatkopar, Vikhroli have also been increased by a similar percentage. These localities are home to the city's burgeoning middle-class and upper middle-class families. Many of them voted heavily for the BJP in the October assembly election. 

While the average hike across the city is between 15-20% for 2015, the highest increase is about 40%. The average hike in the past two years has been 13%. 

< .. "We will again approach the state government to stay this hike because it will hurt sales. The move will not result in higher revenue for the state as the sales itself will remain subdued due to the hike," said Dharmesh Jain MD of Nirmal Lifestyle. Jain added that the developers' body will seek to meet the revenue minister in the next few days.  The ready reckoner is used to calculate the market value of properties for paying stamp duty and registration charges at the time of registering the transaction. The rates are different from market rates. Taxes such as stamp duty, value added tax, sales tax and the registration charges are based on such government provided ready reckoner rates. Rate changes were made for all of Maharashtra on Wednesday and it is customary for the government to announce such changes on the new year. The city BJP chief Ashish Shelar admitted that he was surprised by the extent of the hike but explained it away by saying that the government needs revenue. "It's a welfare state and if needed the government will take a call on these rates for the benefit of common man," he added.  "The buyers' outgo will increase now and will impact the sales absorption further. For a realty developer it's a double whammy as he will have to pay higher stamp duty for land transactions and will also have to convince the buyer to shell out more to buy the finished product," said Ramesh Nair, COO &International Director, property consultancy JLL India.

Sewri-Nhava Sheva sea link, Navi Mumbai airport's compensation to match

While the City and Industrial Development Corporation (CIDCO) has commenced the allotment of 22.5 per cent of developed land to the project affected persons (PAPs) of the proposed Navi Mumbai international airport, villagers affected by the planned Sewri-Nhava Sheva sea link freeway bridge project also have good news. 

The town-planning agency revealed that recently they had a discussion with PAPs of the sea link project, and said that the villagers affected by the project would get land compensation package on the same lines as the airport scheme. Sanjay Bhatia, managing director, CIDCO, said, “We had a talk with the PAPs from Chirle, Ghavan and Jasai villages which would be affected by the project. We discussed a land allotment scheme similar to that of the airport project and they (villagers) will take a final call by next week.” 

This means villagers will get 22.5 per cent of the total land they give up for the project, in form of developed plots. 

The sea link, which proposes building a 22.5-km bridge with six lanes connecting Sewri to Nhava Sheva, requires nearly 37 hectares of village land. 16.5 km of the bridge will be over seawater, while 5.5 km will consist of a viaduct on land. The bridge will terminate near Chirle village and its neighbouring areas in Uran. 

The project, being helmed by the MMRDA, will be implemented through a public-private partnership on the design, build, finance, operate and transfer (DBFOT) model. The estimated project cost has shot up to around Rs 11,000 crore from Rs 4,000 crore in 2005, and has a scheduled completion deadline of 2019. Meanwhile, CIDCO on Wednesday carried out the third lottery of plots for the PAPs of the upcoming Navi Mumbai international airport. This would give them 22.5 per cent of developed land in the project. The villagers will also be granted an FSI of 2 for construction on these plots

Kalyan could be next big business hub by 2028

B y 2028, or 13 years hence, the rapidly developing suburb of Kalyan could be transformed into a business and cultural hub and a self-sufficient township, according to a plan submitted to the city’s development authority by the South Korean government.

A South Korean government think-tank under its Ministry of Land, Infrastructure and Transport, which has suggested the creation of five growth centres in the outer Mumbai region, has recommended developing Kalyan as the first priority keeping in mind its accessibility and growth potential. 

The other four centres recommended are 

Vasai-Virar, 

Bhiwandi, 

Greater Panvel and 

Pen-Alibaug.

Based on its experience in development of new districts around its capital Seoul, it has outlined a concept plan for a Kalyan growth centre, which could be completed by 2028 with an investment of Rs 56,676. 2 crore.

U P S Madan, metropolitan commissioner at the Mumbai Metropolitan Region Development Authority, said, “The concept of creating such cities in these countries is very different from ours. There a lot of infrastructure that is first put in place by the government and then the private sector follows. However, here it looks too huge an amount to spend upfront and expect returns over a longer period of time. In that sense, it doesn’t seem to be workable. A step-by-step approach is one option. We have asked them to give a more detailed implementation plan. The team will be visiting again on December 3.”

According to the report, the growth centre in Kalyan is proposed to be created across 27 villages – 19 in Kalyan and 8 in Ambernath – for which the MMRDA is already the special planning authority. The total area would be 1,077 hectares for a planned residential population of 2,91,000 people.

The area is expected to be well connected with the existing Mumbai-Kalyan radial, the Central railway line, the proposed Virar-Alibaug Multi Modal Corridor, and two state highways. The MMRDA has also been studying the possibility of setting up a mass transit corridor connecting Thane-Bhiwandi-Kalyan.

The growth centre will be a smart city with all urban infrastructure services like private and public offices, museums, theatres, colleges, shopping malls, business hotels, convention centres, health centres, markets, libraries and so on.

Sanjay Dutt, a member of the state’s Legislative Council and a Congress leader from Kalyan West, said, “Kalyan has fallen prey to haphazard unauthorised development due to delays in implementation of infrastructure development and the notification of a development plan for these 27 villages. If the government wants to seriously act on this report and develop Kalyan as a growth centre, the basic infrastructure has to be put in place first. 

Currently, Thane has a system of basic infrastructure developed with residences, commercial areas, good roads and connectivity, but Kalyan doesn’t even have that. Secondly, the government will have to fast-track plans for a mass transit corridor connecting Kalyan and actually take it beyond to areas like Ambernath and Titwala. Also, a development plan needs to be put in place at the earliest to stop illegal constructions.”

According to the report, the region is proposed to have 67,686 houses to accommodate a population of 291,077 people. The think-tank has recommended phasing out the implementation between 2015 and 2028, with the first phase to be developed in areas around major road corridors such as the proposed Virar-Alibaug Multi Modal Corridor and state highways. The second phase will include areas along a monorail line and the third phase to develop the remaining area. The think-tank suggests either public acquisition or land pooling as the means to make the project feasible. “It is still too early to talk about financial models. 

We will need to discuss with the state government and get its views on this proposal for the growth centres,” Madan said. Under public acquisition, the government will have to spend Rs 35,062 crore on land acquisition according to the new regulation and Rs 10,518.6 crore as compensation to the project-affected. Considering all other costs, the project is estimated to cost Rs 56,676.20 crore, excluding the regional transport infrastructure such as the main highway, monorail or the Multi Modal Corridor. Under the land pooling option, assuming a 10 per cent public ownership before pooling, the plan envisages returning 53.2 per cent of land to the owners and using 41.4 per cent for public facilities such as parks, recreational spaces, roads and other facilities. About 5.4 per cent could be reserved for sale, which would help the government break even. This model is likely to require a total investment of Rs 2980.50 crore.

Govt relaxes FDI policy for real estate sector

Removes lock-in period, minimum land area requirement

The government on Wednesday eased foreign direct investment (FDI) norms for the construction development sector, which is expected to provide a substantial boost to the sector in terms of greater foreign capital inflows.

Notifying the decision taken by the Cabinet in November, the Department of Industrial Policy and Promotion (DIPP), the nodal agency for all FDI policy, said foreign developers would now be allowed to exit a project only after completion or after completing the basic trunk infrastructure such as roads, water supply, street lighting, drainage and sewage.

Earlier foreign developers were not allowed to take out the invested amount before three years from completion of minimum capitalisation. However, now the foreign firm can take its money out or transfer its stake to another non-resident company before completing the project on approval from the government.

“The relaxation of the lock-in period comes as a major relief for the industry. The new rules allow FDI in smaller projects, which is a big relief. Besides, by doing away with the lock-in period, the government has now made the norms much simpler,” said Akash Gupt, executive director at PwC. In a significant step, the government also allowed foreign investors to invest in completed project for "operation and management."

In other words, 100 per cent FDI under the automatic route can now come in projects that have been completed by way of townships, malls and shopping complexes, and business centres. This was not allowed earlier.

"The notification eases foreign investment rules in India's construction sector, which has been troubled by problems such as paucity of funds and regulatory bottlenecks, said Sachin Sandhir, global managing director, emerging business, and managing director, South Asia, RICS.

Projects in semi-urban and peripheral locations of Tier I cities or locations in Tier II and Tier III cities could also take off at this scale, as land prices in these regions and the total capital investment requirement were attractive, he said.

Besides, under the new policy, the DIPP has also reduced minimum area requirements. Unlike the previous policy, foreign real estate developers can now invest in construction development projects having a minimum floor area of 20,000 sq meter. Earlier the requirement was 50,000 sq meters of built-up area. Similarly, the capital requirement was decreased from $10 million to $5 million.

"This is an extremely positive step and virtually meets most of the demands made by the industry. Moreover, by permitting transfer of stakes between two non-resident companies the government has literally opened the floodgates for FDI in the real estate sector," said Punit Shah, co-head of tax at KPMG.

Between April 2000 and September 2014, the construction development sector received about $24 billion, constituting 10 per cent of the overall FDI into the country during the period. However, since 2012-13, FDI inflow into the sector has slowed drastically. In 2012-13, it fell to $1.3 billion from $3.1 billion the previous year. It again declined to $1.2 billion in 2013-14. During the first six months of this financial year, only $568 million has flowed into this sector.

Cidco revamps policy to take on encroachments on its land

NAVI MUMBAI: City Industrial Development Corporation (Cidco) has decided to take a tough stand on illegal encroachments. Under its revamped action plan, it is mandatory for anti-encroachment officers to register an FIR before demolition and procure a court order, if required. Also, there would be zero-tolerance policy towards any sort of external interference. 

MD Sanjay Bhatia introduced Sunil Kendrekar, who will be heading chief controller of unauthorized construction (CCUC) and the personnel department, at a media meet held on Tuesday. Kendrekar said demolition drives will not be conducted without filing an FIR and action will be taken against those officers who fail to do so. 

Residents can inform CUC about encroachments by posting pictures and details on Whatsapp (8767753114). The department will be monitoring all Cidco-owned plots and management information reports. 

Speaking against coercive tactics, Kendrekar said, " To reiterate the fact that the law is equal for all, 20 unauthorized constructions in Navi Mumbai airport influence notified area (NAINA) and 20 encroachments within Cidco area, reportedly belonging to influential people, are to be demolished soon ," he said. All new constructions within 200m radius of the gaothan area will also be demolished. 

All nodal administrators are authorized to prevent encroachments and will be provided with a squad as well. 

"Currently, there is only one demolition team which is insufficient, considering over 5,000-odd Maharashtra Regional and Town Planning (MRTP) notices have been issued. We are seeking four units of demolition squad for NAINA region and four more teams for Cidco areas," added Kendrekar. 

Review decision will hurt realty sector: Devendra Fadnavis

Chief minister Devendra Fadnavis' decision to review all major property development projects cleared during the last four to six months of the previous government has put the sector in a fix. Big projects will run into major cost overruns and the sector itself will be in a state of suspense for three or four months now according to realty experts.

Why are these development projects being reviewed?
The BJP government is taking cognisance of the charge levelled by the former irrigation minister Ajit Pawar that Rs12,000 crore worth of projects were cleared in a hurry during the last months of his tenure by then chief minister Pritviraj Chavan without due diligence. Fadnavis wants to see if procedures were followed.

What did the previous government do?
Though the actual value of projects cleared is unknown, a slew of major cluster development projects, most of it in Mumbai, were cleared during the last few months. Ajit Pawar was hinting at corruption when he made the allegation against his own chief minister.

What does Chavan have to say?
Chavan told dna that the new government has every right to review any decision taken by his government. "I have no objections to them reviewing the decisions taken be me. I have not done anything wrong. If the cost of the projects increases by this move, then the incumbent government has to think over it," Chavan added.

What is a cluster development project?
A developer with minimum of 4,000 sq meters of land can present plans for cluster development which will include all amenities. The government will then allot a Floor Space Index of 4 which means four times the land area can be build as towers or sky scrapers.

Why are developers upset?
For developers who have raised debt to go ahead with projects already cleared this review will mean huge losses. Kailash Agarwal, chairman of Avighna Developers which is doing a cluster project in South Mumbai says, "Cluster development policy will be most affected by the review decisions. There are only couple of cluster developments projects which have been successfully executed since the inceptions of the scheme in 2009. The review will result in three months delay and escalate the cost many fold," Agarwal added. Other developers feel they will now have to pay bribes the second time for the same project.
Sunil Mantri, president of National Real Estate Development Council said the new chief minister can review the previous government decisions but it should be done "speedily and with good intention". Atul Nemade, realty expert said this move will bring the already suffering real estate sector to a grinding halt.

Maharashtra government may not set up watchdog body for housing sector

The BJP-led state government is unlikely to set up a watchdog body that would curb malpractice in deals involving real estate, sources told dna. The Housing Regulatory Authority (HRA) is the responsibility of chief minister Devendra Fadnavis, who has charge of the housing department. The HRA bill was passed by the previous state government.

What can the proposed HRA do?
A state housing department source said, "The Congress-NCP government had decided to set up the HRA to deal with the problems in the real estate sector. This move would have brought transparency to the housing sector and relief to the buyers."

Ramesh Prabhu, chairman of the Housing and Society Welfare Association told dna that the BJP-led government should pursue this issue of public interest. "If they scrap such an important bill, then the errant and unscrupulous developers will get a free hand once again," Prabhu said.

The HRA proposal envisaged having a website where potential buyers could check whether all building permissions for particular projects were in place. Moreover, the website would show which flats in a particular project were sold and which were available. The HRA would also help duped buyers come together, and get their stalled housing project up and running again.

What is the government doing to stall its implementation?
There is a strong sign that the Fadnavis government seems to have decided not to pursue the proposal, the housing department source said. "We have received more than 1200 suggestions and objections for framing the HRA guidelines. We have even submitted them to higher authorities, but these suggestions for HRA have been gathering dust in the Mantralaya for a long time. This shows that the government is not keen to go ahead with the HRA."

Moreover, the Fadnavis government has yet to set aside office premises for and appoint the office-bearers of the HRA, the source said. "We have not yet identified the office, the chairman and the members for the HRA. It seems that everything is in limbo. There is no clarity on this issue as of now," the source said.

Why is the CM not taking prompt action on HRA?
The state housing department is handled by chief minister Fadnavis, who also has charge of the home, urban development, general administration and other departments.

Another official said the chief minister has his hands full with issues from other departments. "The CM does not have time for the housing and urban development departments. Actually, these departments are very crucial for metros such as Mumbai. If these departments are neglected, then it will create a mess and the housing problem will escalate," he said.

After scrapping the HRA, the government may wait for the central housing regulatory bill to pass through parliament. Then the state government would not need to get a separate bill passed in the assembly.

Will a central HRA bill do justice to Mumbai?
But Prabhu said Mumbai's peculiar housing issues merited having a separate bill. "The problem is that Mumbai and its extended suburbs have different real estate issues than those of other cities. We cannot use the centre government's rules to resolve Mumbai's housing issues. We should have separate rules and regulations, which are tailored to Mumbai and its suburbs. Otherwise, the bill will come with various loopholes put in, which will give scope to developers to dupe the buyers and come out unscathed," said Prabhu.

Developers oppose high development fee at NAINA

CIDCO’s decision to levy very high development fee for permission to develop projects in Navi Mumbai Airport Influence Notified Area (NAINA) will be detrimental to the development of the area, according to Rajesh Prajapati, managing director of Prajapati Constructions.

The exorbitant development charges will tender affordable housing into a joke as the cost of housing is bound to double. The development fee will translate into cost hike by Rs 500/- a square foot, Prajapati said.

As it is, the cost of housing is very high in and around Navi Mumbai and home buyers are looking at outskirts of the city for affordable housing, he said and argued that the new levy is bound to make affordable housing shortage even more acute.

“We hope better sense to prevail and CIDCO will reconsider their decision, most importantly in the interest of home buyers who have very few options and nowhere to go,” he said.

Prajapati drew the attention of CIDCO to widespread illegal construction going on in NAINA area and said the planning authority’s new move will further aggravate the problem and innocent buyers will be hit hard.

Government plans to offer interest subsidy on housing loans to help poor section buy homes and boost real estate demand.

NEW DELHI: The government plans to offer interest subsidy on housing loans to help poor section buy homes and boost real estate demand. 

Addressing the realtors' body CREDAI conclave, Minister for Housing and Urban Poverty Alleviation Venkaiah Naidu said the Real Estate Development and Regulation Bill would soon come up in the Cabinet for approval and hoped that at least by the Budget session, the proposed law would become a reality. 

"We are coming out with an interest subvention scheme for the housing sector for the economically weaker section (EWS) and lower income group ( LIG) people and also partly to lower middle class people," Naidu, who also holds the portfolio of Urban Development, said on the sidelines of an event. 

He said the government is moving towards reduction in interest rates, which are difficult to manage currently. 

Asked about timeline, the Minister said when the new housing policy will be launched, the interest subvention scheme will be a part of it. 

According to government estimate, the housing shortage was 18.78 million units in 2012, out of which 95 per cent was in EWS/LIG category. 

Real estate sector is facing a huge slowdown in demand due to high interest rate regime and skyrocketing property rates. 

Responding to realtors' demand for single-window approval, he said the procedures for getting the approvals, particularly related to environment and aviation clearances, would be simplified and fast-tracked. 

On the Real estate regulatory bill, Naidu said it is at the "final stage of consultation" 

"I have gone through it personally. We have taken the views of various stakeholders including real estate sector. Then we will go to the Cabinet shortly. Once the cabinet approves, I am hoping we will get early clearance, then we will go to the Parliament. 

"If not this session, at least by the budget session the Real Estate Development and Regulation Bill will be a reality," Naidu said. 

"There will be no strangulation, only regulation. It will be a people friendly and construction sector friendly bill. In a democracy, regulation is required," Naidu said, adding that the state governments would get the freedom to frame rules under the Act, when it is passed by the Parliament. 

The Real Estate regulatory bill, which was introduced in Rajya Sabha in August last year, seeks to protect home buyers from unscrupulous developers. In February this year, the Standing Committee submitted its report. 

The Bill provides for mandatory registration of all projects, besides mandatory disclosure of information like details of promoters, layout plan, land status, schedule of execution, status of various approvals and carpet area. 

The Bill seeks to enforce the contract between the developer and buyer and provides for quick remedial measures in case of disputes. 

Stating that a whopping Rs 14 lakh crore would be needed annually to achieve Housing For All by 2022, Naidu said Centre will promote public-private partnership in the real estate sector. 

"You (CREDAI members) are our partners. This government does not treat the businessmen as untouchables. Businessmen are part of India. They are part of our development. Without their co-operation, we cannot move forward. I have no hesitation to say this," Naidu said. 

"My government is open. We want to encourage manufacturing sector. We want to encourage business community so that they create wealth and then we can prosper, we can distribute and we can reach to the bottom and let upliftment of the masses. This is the belief of my government. 

"There are people who do business with businessmen in the night and then condemn them in the day. We don't do it. I have no problem, I will say this in Parliament also that you are our partners," Naidu said, while extending all the assistance that the real estate sector needs for the growth. 

The Minister said the real estate and construction sector contributes only 6 per cent to the GDP, but it has a potential to reach 12 per cent by 2022. 

While seeking support from opposition parties on passage of key bills including insurance, Naidu said: "Even my friends in the opposition need to understand the mood of the people. People want stability, governance and development." 

"I hope that the opposition will also realise that the need is to get maximum investment and support us whether regards to the insurance bill or with regards to investment in the various sector," Naidu said, adding that infrastructure development was not possible without investments. 

"They should not oppose for the sake of opposition," he added. 

Criticising the previous UPA government, Naidu said the situation and mood have changed in the country since the NDA has come into power. 

Foreign investors are looking at India and they want to do business in India, he said. 

Showering praise on Prime Minister Narendra Modi's leadership, Naidu said: "Situation has changed now. There is trust, confidence, leadership, vision and the government is acting fast to extent possible" 

Govt can't force us to build affordable homes: developers

Maharashtra government’s decision making it mandatory for builders to construct affordable houses in projects that exceed 4,000 sqm has not gone down well with Mumbai developers.

The decision, which was first implemented by the previous Congress-NCP government two years ago, made it compulsory for builders working on plots measuring more than 4,000 sqm to reserve 20% of the land for affordable housing.

According to the original policy, these houses would to be handed over to the Maharashtra Housing and Area Development Authority (Mhada), and the housing agency would then sell them through a computerised lottery system.

However, builders had opposed it then, and got the directive stayed by the court.

But the new BJP government has now amended the policy, to allow builders to construct affordable houses anywhere in the same administrative (civic) ward. The new rules do not apply to redevelopment projects across the city.

“This clause of compulsorily building affordable houses is unfair. We pay exorbitantly to purchase land in the city. It is wrong of the government to force us into this,” said Sunil Mantri, president, National Real Estate Development Council. Mantri said the builders would challenge the directive in court.

According to Paras Gundecha, former president, Maharashtra Chambers of Housing Industry (MCHI), said the move was an unfortunate one.

“All rules are imposed on private builders. State agencies like the Cidco and MMRDA are minting money by auctioning their land at mind-bogging rates. These agencies should ideally be using that land to generate affordable housing, instead of forcing us to do so,” said Gundecha

Maharashtra: BJP sets target of 5 lakh affordable houses in next 5 years

The BJP-led new government in Maharashtra has decided to provide five lakh affordable houses in Mumbai and in its extended suburbs in the next five years.

According to a senior cabinet minister, they have decided to construct as many houses in Maharashtra as possible. "Mumbai is main... where house prices have gone through the roof. We will ask developers to construct smaller houses and sell the same to people at reasonable rates. The rate in an extended suburb will be maximum Rs2,000 per sqft, while in the city Rs4,000 per sqft. In return, the developers will get additional FSI and tax exemptions from government. We have decided to make this a time-bound programme," said the minister.

He said before forming the government, they had made a detailed plan and consulted developers, urban experts and banks. "We had discussed the plan with all stakeholders, they had given their nod as well. We will ask developers to construct on larger plots so that more houses can be built," he added.

A senior state government official told dna that by promoting affordable houses, other supplementary industries, which depend on the construction industry, will also grow. "We want to see the economy rolling. It should not be stagnant. That will help increase thegrowth rate of Maharashtra as well as India. Recently, we made a presentation before the chief minister and his cabinet, they have agreed on it. Very soon, a meeting with prominent developers will be called for a final decision on this," he added.

Sunil Mantri, president of National Real Estate Development Council, an umbrella body of developers, welcomed the decision. "We are ready to tie up with the government for this. But the state should exempt us from tax and stamp duty. We pay almost 30% of the total cost of a house as taxes," he said.

Mantri added that a house is a social need and no one wants to stay in a rented place for long. "Due to unaffordability of houses, many industrial houses and IT companies were shifting base from Maharashtra, or were not keen to set up here. Once their employees start getting affordable houses, these industries will come back to Maharashtra," he said

MMRDA's plan to convert BKC into smart township

The Mumbai Metropolitan Region Development Authority’s plan to convert Bandra-Kurla Complex into a smart township has seen a lot of companies expressing interest. MMRDA says it has received several Expression of Interest (EoI) bids after it invited the applications last month.

MMRDA plans to make BKC a smart township, but is yet to decide the model through which it will develop the facilities. File pic

MMRDA plans to have high-speed wi-fi connectivity throughout the township and install solar streetlights. The agency also wants to develop better parking facilities in BKC and cover the entire area with a comprehensive video surveillance system.

Officials say many companies are approaching them, wishing to develop these facilities. An official told mid-day, “Recently we met representatives of a few companies who wanted to know about the ‘Smart BKC’ concept in detail. We were surprised to see the number of people coming forward.”

Quizzed about the cost of the project, the official added, “At present I cannot comment on the cost because we have not decided whether we will implement the project on a Build-Operate-Transfer (BOT) basis or some other model.” MMRDA is the Special Planning Authority for the township.

October 28 is the last day for submission of EoI bids online. The MMRDA developed BKC with sole purpose of providing a financial and business hub and also to decongest south Mumbai. BKC already has a number of financial and business houses like National Stock Exchange, SEBI, Diamond Bourse and various national and international private banks.

It also has schools, a hospital, five-star hotels, and consulates of USA, UK, Australia and France, apart from being home to residential quarters for government employees. As per an MMRDA official, BKC provides 2 lakh jobs.

“The Authority has developed 19 hectares of land (E Block) with the presence of prominent institutions such as the Reserve Bank of India, Income Tax, Sales Tax, Provident Fund and many other corporate and commercial establishments.

“Together, these buildings offer 160 hectares of office space with potential to accommodate thousands of workers. Developing the Bandra-Kurla Complex as a smart township will only add on to the features,” the official stated.

- See more at: http://www.mid-day.com/articles/mumbai-mmrdas-plan-to-convert-bkc-into-smart-township-finds-many-takers/15702187#sthash.YavOVCG2.dpuf

BJP to reward Maharashtra with Rs 37,000 crore infrastructure push

Bharatiya Janata Party's (BJP) win in Maharashtra is likely to stoke a fresh lease of life in infrastructure projects worth Rs 37,118 crore across sectors such as highways, ports and shipping and Special Economic Zones (SEZs).

These projects are being monitored from the cabinet secretariat level with the state government, and, now, with the BJP set to assume power in the state, they are likely to get expedited.

"The government is actively considering projects worth Rs 11 lakh crore in all, which will be facilitated soon. By March next year, each ministry will have their own Apps to help track all project applications and processes online," said Anil Swarup, additional secretary, cabinet secretariat.

In Maharashtra, major infrastructure projects are likely to get a push. Indiabulls SEZ is a multi-product SEZ worth Rs 14,650 crore that is being reviewed. The SEZ is spread across 1,011.26 hectares at Sinnar, Nashik.

The Maharashtra Industrial Development Corporation has leased out the land for 95 years. The SEZ will have manufacturing industries across sectors such as auto and auto ancillary,pharmaceuticals (formulations), light engineering and electronics, electrical and aviation and ancillary.

Two road and highways projects worth about Rs 12,000 crore are being reviewed by the central government. One of them is the Rs 9,630 crore Mumbai trans harbour link, and, the other, the Rs 2,538-crore L&T East West Tollway project.

The trans-harbour link project envisages the construction of a 22-km sea link, a six- lane road bridge from Sewri on the Mumbai side to Chirle on NH4B in Nhava on the mainland.

It also includes the construction of interchanges at Sewri on the Mumbai side and at Shivaji Nagar and at Chirle on mainland side. L&T East West Tollway is carrying out the four-laning of Amravati- Jalgaon section of the NH 6.

Three port projects, worth Rs 10,300 crore, are also being expedited. The Rs 1,800 crore Alewadi Port, a greenfield container port, is one. The project is expected to create 3,000 jobs during the construction phase and around 1,000 jobs during the operation phase.

The Rs 6,000 crore Rewas Port, being proposed by the Maharashtra Maritime Board, a state government undertaking, has proposed a mega port within the Mumbai harbour region – is the other. The Rs 2,500 crore Vijaydurg Port is the third project

Shilphata May be The Next Biggest Residential Belt in Navi Mumbai

When it comes to housing in Mumbai, some of the current hotspots are Mira Road and Ghodbunder Road. There are several reasons such as affordability, good connectivity and growing infrastructure leading to real estate growth in these areas. Similar to these areas in Mumbai, Shilphata has the potential to become the next residential hotspot belt in Navi Mumbai.

Shilphata area profile

Shilphata is a strategic area lying between Thane and Navi Mumbai. It lies on the intersection of NH-4 and SH-76, with neighbouring areas such as Mumbra in Thane, Airoli, Ghansoli, Kopar Khairane and the MIDCarea near Vashi. The area also connects the upcoming areas of Dombivli and Kalyan to the industrial areas of Kharghar and Vashi via theKalyan-Shilphata Road. Some of the other important roads in the area are Kalyan-Shilphata Road and Shilphata Mahape Road. Due to these roads, Shilphata acts as a gateway to Navi Mumbai for people coming from Thane and Kalyan-Dombivli areas. There are regular buses plying this area from Thane and Navi Mumbai.

The area is yet to be developed in terms of social infrastructure, civic amenities and housing. There are plans to improve the rail connectivity to the area. The planned monorail line between Mahape and Kalyan will pass through the area. Currently, there is also a shortage of drinking water and electricity in Shilphata. If developed properly, these problems too may be resolved.

Real estate trends

The biggest deterrent for Shilphata’s real estate development is the current lack of civic amenities and social infrastructure. Yet, this has not deterred developers from coming into this area. There are already several projects available by developers such as Gajra Group, Marathon, Lodha Group and Runwal Group. The most common apartment configurations in the area are 1 and 2BHK apartments. Most of these apartments are sought after by employees in the nearby industrial zones. The typical built area of a 1BHK apartment is about 630-835 sq. ft. and that of a2BHK apartment is about 800-1,100 sq. ft.

While one may buy a 1BHK apartment for about Rs 30-50 lakh, a 2BHK apartment may be bought for about Rs 35-55 lakh. The approximate property values in the area are in the range of Rs 4,300-5,700 per sq. ft. If the infrastructure is developed properly, the locality’s real estate will gain a big boost.

Shilphata has a huge potential in terms of real estate growth, primarily due to its strategic location and good road connectivity. With proper development, it may become the next Ghodbunder Road and Mira Road.

Home prices in Delhi set to zoom as Delhi government hikes circle rates

The Economic Times

Home prices in the capital are set to go up further with Delhi government today hiking the circle rates -- the minimum valuation at which properties have to be registered -- by up to 20 per cent with an aim to check black money component in sale and purchase transactions.

As per the decision approved by Lt Governor Najeeb Jung, the circle rate has been increased to Rs 7.74 lakh per square metre of land from Rs 6.45 lakh in category A residential colonies like Greater Kailash, Defence Colony, Gulmohar Park, Panchsheel Enclave, Anandlok, Green Park, Golf Links and Hauz Khas.

This means nobody would be allowed to buy land and immovable properties in these colonies for less than Rs 6.45 lakh per sq m.

The new rates will come into effect from tomorrow. The land rates in Category B neighbourhood like Andrews Ganj, Kalkaji, Munirka Vihar and Nehru Enclave have been increased to Rs 2,45,520 as against current rate of Rs 2,04,600 per sq m.

The circle rates in the city was last revised in November 2012. The rates were then hiked by a whopping 200 per cent.

For C category colonies, the circle rate has been hiked to Rs 1,59,840 from current Rs 1,33,224 per square metre while in neighbourhood under Category D the new rates will be Rs 1,27,680 as against existing rate of Rs 1,06,384.

The rate for colonies under category E has been hiked from Rs 58,365 to Rs 70,080 per square metre while for F category colonies the rate will be Rs 56,640 as against current rate of Rs 47,140.

In respect of category G colonies, the new rate will be Rs 46,200 per square metre as against existing Rs 38,442 while for H category colonies it has been hiked to Rs 23,280 from Rs 19,361.

The circle rates were first introduced in Delhi in 2007, dividing the capital into eight categories, and were notified under the provisions of the Delhi Stamp (Prevention of Undervaluation of Instruments) Rules, 2007 on July 18, 2007.

Officials said the minimum property rates for commercial, industrial and other uses will be considered based on various other factors like age of the building and minimum rate of construction.

In category A colonies, the minimum rate of construction for residential use will be Rs 21,960 per sq m while it will be Rs 25,200 for commercial use.

For category B localities, the minimum rates of construction for residential use will be Rs 17,400 while for commercial use it will be Rs 19,920.

In category C colonies, the construction rate for residential use has been fixed at Rs 13,920 and for commercial use the minimum rate will be Rs 15,960 while in neighbourhoods under category D, the rate of construction for residential use will be Rs 11,160 and Rs 12,840 for commercial use.

For category E, the minimum residential and commercial rate of construction has been fixed at Rs 9,360 and Rs 10,800 respectively. In F category colonies, the minimum residential construction cost will be Rs 8,220 and for commercial use it will be Rs 9,480.

The government has made specific criteria for proper valuation of the properties based on age of the structures. To evaluate minimum valuation of properties, a point-based system has been introduced based on year of completion of construction of the buildings.

As for example, buildings constructed prior to 1960 will get 0.5 points, those built between 1960-69 will get 0.6 points while flats built between 1970-79 will be accorded 0.7 points.

Those built between 1980-89 and 1990-2000 will get 0.8 and 0.9 points respectively while all the buildings built 2000 onwards will get 1 point.

The government has also categorised flats depending on the plinth area based on which minimum built up rate has been finalised.

If the plinth area is up to 30 sq m then the minimum rate of built up area for DDA colonies and group housing societies in case of residential use will be Rs 50,400 while the minimum built up rate for DDA colonies, cooperative housing societies and flats by private builder for commercial use will be Rs 57,840.

If the built-up area is above 30 and up to 50 sq m, then the minimum rate for built up area for DDA colonies and group housing societies for residential use will be Rs 54,480 while for commercial use it will be Rs 62,520.

If the built up area is above 50 sq m and up to 100 sq m, then the built up rate will be Rs 66,240 per sq m while for commercial use it will be Rs 75,960.

Above 100 sq m, the rate for residential use will be Rs 76,200 while for commercial use, it will be Rs 87,360. The land rate for the properties will be calculated separately depending on the category of the colonies.

For flats having more than four storeys, a uniform rate per sq m of Rs 87,840 will be taken as minimum value of built up rate for residential purpose while if same is used for commercial purpose, the uniform rate of Rs 1,00,800 will be taken as minimum value of built up area per sq m.

If one floor of an independent property other than a flat is sold, then the relevant minimum land cost will be taken for proportionate plinth area sold and the minimum cost of construction will be applied on the plinth area, said an official.

Keywords:circle rates

Real estate revival may begin this festive season

This could be the beginning of a revival in the real estate sector. After two dry festival seasons for property launches, developers are gearing up for action this time.

Tapping the positive sentiment of a stable government at the Centre, realty companies have lined up at least 100 new projects for launch across big cities - the highest number of these in the National Capital Region (NCR) - ahead of the festival season. The seasons in 2012 and 2013 went by with hardly any property launches, mainly due to an economic slowdown and a need to clear the backlog.

Discounts were being planned in plenty this time, pointed out analysts. Seeing the surge in enquiry, brokers are offering discounts of eight to 15 per cent, depending on location. In contrast, hardly any discounts were on offer last year, though in some cases value-adds were thrown in. Also, the number of advertisements by real estate players across various platforms - print, electronic media, hoardings, email, phone, social networks - has grown manifold from the previous years.

According to brokers, the new launches have been planned because of rising interest levels following the return of positive sentiment. However, there is still some caution over whether the launches would translate into sales.

Developers like Godrej Properties, Tata Housing, Supertech and Mahindra Lifespaces have launched projects with the festival season in mind, and more are on their way. NCR-based developers Saya, M3M and Chintels are also preparing for launches.

Depending on a buyer's bargaining power, a residential unit can come Rs 5-15 lakh cheaper this season. The number of enquires had risen two to three times from six months ago, brokers said. There is also talk of property prices climbing next year.

According to real estate website Magicbricks, 250 property deals are currently on across major cities. Another portal, Indiaproperty, talks of flat discounts of up to Rs 15 lakh and other freebies in various residential projects. Free vacations, gold vouchers and coins, modular kitchens, furnishing up to Rs 5 lakh and no registration fees are also being offered by developers.

The realty market has been hit by an economic slowdown and, coupled with the financial constraints of developers, there has been little activity and low sales in the past two years. Also, the sector was sitting on a high inventory, so developers focused earlier on clearing the backlog instead of new launches.

CBRE South Asia Chairman & Managing Director Anshuman Magazine said the coming festival season would be better than the previous two. But a revival was at least a year away, he added.

"Sentiment is positive and encouraging, but it is too early to assess the impact. Business during the coming festival season is expected to be better than last year. A complete revival might take a year or more. The key is improving liquidity in the market and mobilising investments from domestic and foreign funds and investors," Magazine said.

The festival period from October to December is expected to garner sales of at least 60,000 units across seven major cities, almost double of that recorded in the past two years. "The festival season will be much better in 2014. Sentiment is positive and enquiries have gone up substantially," said Ashutosh Limaye, head of the research and real estate intelligence service at JLL India.

Average annual sales for the sector are expected to reach 200,000 units this year, with a good festival season contributing 30-40 per cent to the total. In last two years, sales were 120,000-140,000 units annually, with very few of those during the festival season, according to industry estimates.

Developers have also been hard-pressed for funds, with not many lenders willing to lend to the ailing sector.

Inventory levels have been rising. The Mumbai Metropolitan Region had an inventory of 53 months at the end of June 2014, while the NCR had an inventory of 45 months, data by research firm Liases Foras showed. Hyderabad had an inventory of 47 months, Pune 23 months and Chennai 26 months. Bangalore had the smallest inventory among major cities, of 19 months. An ideal market maintains an inventory of eight months.