After 130 yrs, state to re-survey all land holdings at a cost of Rs 1,600cr





The state government's ambitious plans to resurvey land holdings in Maharashtra will cost approximately Rs 1,600 crore, a 220% jump over the original 2008 estimate of Rs 500 crore. The cost is to be shared equally between the Centre and the state government. The state is spread over 3.07 lakh sq km, of which 2.8 lakh sq km, or 91% of the land mass, is to be re-surveyed. This includes all land holdings except city survey areas, gaothan and forest areas.

The re-survey , which is being undertaken under the National Land Record Modernisation Programme after 130 years, is awaiting an amend ment to the Maharashtra Land Revenue Code, 1966, and the Prevention of Land Holding Act, 1948, to proceed.

The survey will take 5-10 years to complete, and its estimated cost is based on a pilot project nearing completion in Mulshi taluka in Pune district. Chandrakant Dalvi, land settlement officer, Maharashtra, said the revenue department had taken up a pilot land re-survey in Mulshi taluka in Pune district which is now nearing completion and the new estimates for the land survey were based on the pilot project. "Several other states have also approached the Centre to revise the rates given the cost escalation,'' he said.

The land mass was first measured by the British in 1802 in the Madras Presidency and between 1830-1870 it was done in the Bombay Presidency. Thereafter a revision survey was carried out between 1880 and 1930.

Based on this survey,maps called Cadastral maps were created along with the record of rights from which follows the 712 extracts and the property cards.

"Since then there have been numerous sub-divisions of land on account of transactions, gift deeds, etc.

These sub-divisions have not been measured by the state. Measurement has been done only in those few cases where interested landholders have asked for a survey. Most land parcels have been created orally and have not been incorporated into the survey maps,'' said Dalvi.

This has led to large number of litigations pending in various courts as the revenue department on account of lack of conclusive proof is unable to give a clear decision.

"The only solution is to re-survey and match the ground reality with the sur vey maps and record of rights,'' said Dalvi.

The state government plans to use high resolution satellite images along with global positioning system (GPS) to carry out the re-survey. "Only in cases where it is not possible to obtain good images on account of tree cover or some such problem will we carry out a physical survey using Electronic Total Station with GPS. This is a machine mounted with a computer that can survey large areas,'' he said.

Once the survey is completed, data published, the process of objectionsuggestions completed, every land-owner will be given a map of herhis landholding. The state revenue department has already approved the survey to be initially carried out in Nagpur, Amravati, Aurangabad, Nashik, Pune and Raigad districts and is now awaiting the amendments to begin the re-survey.

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Alarm in K'taka, TN as Naidu 2.0 goes on biz hunt





Uses New State's Tax Breaks To Woo Tech, Mfg Investment

For many years after he lost office in 2004, Chandrababu Naidu would flinch when complimented on his industry-friendly approach as chief minister of united Andhra Pradesh. He seemed wary of owning up to his past, attributing his electoral loss to the pursuit of liberal economic policies that were seen to be focused around Hyderabad and ignored the rest of the state, particularly rural AP.

Back in the saddle this June, Naidu 2.0 is closer to his old avatar. His pincer raids on Karnataka and Tamil Nadu have raised hackles in both Bengaluru and Chennai, with Karnataka chief minister Siddara maiah complaining to PM Narendra Modi about the unfair tax breaks AP gets because of its `new state' status. No surprises for guessing that J Jayalalithaa had also shot off a similar missive to the PM.

That the CM of a state that's synonymous with IT and accounts for almost 40% of India's technology industry is worried about Naidu's charm offensive is a good indicator of how serious Karnataka is taking Naidu's threat.

Naidu wants to attract $2 billion in IT investments over the next 5 years to AP . He also wants to create 50 lakh tech jobs, take broadband connectivity (1,000 mbps or gigabit) to every village and make at least one person e-literate in every household. With AP chief minister Chandrababu Naidu going all out to attract investments to his state, the Karnataka and Tamil Nadu governments are panicking. Not only does Naidu want to attract $2billion in IT investments in five years, to boost entrepreneurship he plans to create one-million sq ft of incubation space by 2019.

In early November, Naidu was in Bengaluru for the nth time, meeting industry captains and entrepreneurs. He made a pit stop at Cisco's campus where he addressed employees at an all-hands meeting, perhaps the first townhall hosted to welcome the head of a local state. He shared his vision on how technology would be the backbone of his state. He also met senior executives from firms like Flipkart, First American Corporation, ITC Infotech and ABB. Besides, Naidu inaugurated the Bengaluru facility of Nutanix, one of Silicon Valley's hottest start-ups, before sitting through a session on e-governance and financial inclusion at the start-up incubator founded by American-Indian billionaire Vinod Khosla.

He visited Khosla Labs and was keen to explore the possibility of using Aadhaar at MeeSeva (at your service in Telugu), a single portal for government-tocustomer and government-tobusiness services. "He had a lot of questions on how GIS could help solve civic problems. Our whole pitch was about governing using data, about running cities using a single dashboard, and he was very impressed," Srikanth Nadhamuni, CEO of Khosla Labs, told TOI.

"He's a very forward thinking leader, an entrepreneur at heart, someone very keen on public service," said Dheeraj Pandey , foun der of Nutanix, the five-year-old, California-based company. Naidu got to know of Nutanix thanks to B V Jagadeesh, an AmericanIndian entrepreneur who grew up in Bengaluru and is an investor in a range of start-ups, including Nutanix.

Naidu's forays to Bengaluru have a specific purpose: To lure investments into the backward Rayalaseema region of AP. Naidu, in his state, is being accused of being partial to the region around Vijayawada, leaving the drylands of Rayalaseema—where his rival Jagan Reddy is strong — out of his development agenda. In TN, Naidu's focus is to get manufacturing investment to move across the border to Sri City, a special economic zone located in Tada, which is 55 km from Chennai.

Naidu is pushing Tada so that major investments that can leverage proximity to Chennai can be located here. Japanese auto giant Isuzu first zeroed in on Chennai for its India plant before opting for Sri City. Lack of industrial land and power in TN combined with access to a high-quality port at Krishnapatnam in Nellore is moving industrial projects across the border. This is naturally causing jitters in Chennai.

In fact, much to Karnataka's chagrin, Naidu got Hero MotorCorp to set up its first factory in in AP . Siddaramaiah had then said, "We offered maximum concessions to the company (tax holidays, excise duty exemption, concessions in entry tax, interest-free loan of central sales tax). But AP offered them free land. We cannot do that because other companies will also ask for it. We cannot compete with AP on this.'' Power is another plus for Naidu. With his government is promising uninterrupted power to factories, the AP-TN border area is turning attractive for industry . "Power is the elixir for industrialization. While AP is surplus, Telangana appears to be struggling on the power front, but for the recent power purchase agreement between Telangana and Chhattisgarh," TS Raghupathy , advisor to India Cements, said.

In fact, what Naidu is doing to TN is exactly what that state did to Karnataka a couple of decades ago. Between 1978 and 1985, a flurry of investments meant for Bangalore stopped just inside the Tamil Nadu border.TVS Motor, Ashok Leyland, Ti tan and several others pumped in hundreds of crores into Hosur, 40km from Bangalore.

Manufacturing investments, obviously , are big on Naidu's mind. End November will see Naidu in Japan where he will pitch for Japanese companies to set up shop in Tada, even while seeking investments for his new capital. This is reminiscent of what he did earlier. In December 1999, Naidu had flown to Bangalore and pleaded with members of the Confederation of Indian Industry to consider AP . He pitched proximity to the interstate border and assured investors of royal treatment.

"More than what he said it was his audacity to call for investments from another state that appealed to businessmen.He was the first CM to woo investors from other states. Previously, CMs only went to Delhi to showcase their states," said T Ramappa, then secretary of the Federation of Karnataka Chambers of Commerce and Industry.

Babu--as Naidu is referred to in AP--did not restrict himself to Bangalore. In the manner of a salesman, he travelled to the US and sat outside the office of Bill Gates for a few hours to meet him. The result: Micro soft set up a development centre in Hyderabad and kickstarted an IT enclave in the Nizam's city.

Many other tech firms followed although by the time they actually came up Naidu had lost polls. They included Infosys, Wipro, Facebook and Google.

Naidu also offered free land to the ISB and got it located in Hyderabad though its first choice was Maharashtra. Impressed by the upcoming Hyderabad, even US President Bill Clinton decided to drop by (as did his successor George Bush).

This time around Naidu's mission is different. Although he claims that creation of a modern IT industry in AP is also his mission, insiders know that with a large coastline, export-oriented manufacturing near the ports offers a greater opportunity.

Moreover, strapped for cash, Naidu requires a lot of investment for the new capital that he wants to build on the river Krishna across the city of Vijayawada.

"I wanted to develop Visakhapatnam after Hyderabad, but by the time the turn came I had lost elections," he says candidly.

Now Visakhapatnam — a port city with a Navy base, two ports and a significant cosmopolitan crowd — is sought to be promoted as the Mumbai of the East.

This is a trifle ambitious considering the city is still reeling from a major cyclone and being on the east coast is vulnerable to more such storms in future.

According to latest reports, Singapore is weighing Naidu's plea to help prepare a blue print for AP's capital. S M Krishna, when he was chief minister of Karnataka, went head-tohead with Naidu to attract IT investments and turn Bangalore into a Singapore. If Naidu has his way, perhaps it will be Vijayawada that will become India's Singapore.

(With inputs from N D Shivakumar in Bangalore)





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CM moots new cluster policy, 20L city homes





A new cluster dev elopment policy for Mumbai and the Mumbai Metropolit an Region (MMR) in the next three months has been prop osed by chief minister Deve ndra Fadnavis in a vision do cument he has prepared for the city and Maharashtra, reports Clara Lewis.

The Dharavi redevelopm ent scheme is to be reinitiat ed, and execution will begin within six months. The CM also considers housing a top priority and wants to create 20 lakh new homes in MMR over five years and decentral ize financial activities from ll Mumbai to the MMR. CM Devendra Fadnavis outlined plans to revive the Mithi river on the lines of the Sabarmati Katha in his vision document for the city and state. He has appointed a special officer, who is not from the bureaucracy , to strategize and implement this vision. The officer is part of the chief minister's office.

Sources said work has begun on addressing the issue of police housing in the city. "Of the 27,000 houses for cops, 7,000 are habitable while 20,000 are in a dilapidated state. Further, there is a need to provide housing for the rest of the police force that lives in terrible conditions in the city or in the distant suburbs.We are in talks with the police force on their needs," sources said.

Apart from decentralizing financial activities from the city to the MMR, the CM plans to address the issue of intra-state migration to Mumbai by developing cities and towns in other regions of the state.

He wants a Mumbai-MMR development master plan with focus on housing, education, marketplace, health, transport, security , solid waste management, environment and open spaces development. Along with the coastal road and the transharbour link, the CM is keen to develop east-west corridors such as the Goregaon-Mulund Link Road. He wants to cut daily travel time by an hour and integrate all transport systems, leading to single ticket access across MMR, states the vision document.

While the Democratic Front government had appointed Mhada to redevelop Sector 5 of Dharavi for which the master plan has already been prepared, sources said the BJP government may opt for public-private partnership.

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SC: New govt free to bail out Campa flats





Civic Body Sticks To Tough Stand

The Supreme Court again offered a glimmer of hope to the residents of Worli's Campa Cola society, where the fate of nearly 100 illegal flats hangs in balance.

The court said on Monday it was "not averse to any relief that the new government in Maharashtra may offer the residents, if it does", while adjourning the case till next Monday.

The residents' hopes now rest on the BJP-led government that will take power in the state. BJP leaders, particularly Shaina NC, have fought for the residents during the two long eviction dramas. A Supreme Court bench of Justice S J Mukhopadhaya and Justice Sharad Bobde, which said it was not against the new state government from giving relief to residents of Campa Cola compound, is hearing a petition seeking clarification on the apex court's orders last year upholding the BMC's demolition notice.

All six buildings on the compound built in the eighties have several floors in ex cess of what was permitted.

The residents are seeking clarity on the possible actions that the BMC could take and said regularization of the illegal floors is possible as there is space available near the compound to offset them. The civic body itself had earlier agreed and had accepted part payment of penalty from the builder, they pointed out.

When the matter came up on Monday , lawyer for the residents Kamini Jaiswal sought an adjournment as senior counsel Shanti Bhushan was not present. The judges asked if the state assembly elections were over. When informed that they were and the process of government formation was on, they said that "if the new government were to offer any relief, we would not be averse to it" and adjourned the hearing.

But the BMC has adopted a tough stand, opposing regularization and saying the society did not even own the land it stands on. Deemed conveyance has been granted, but the BMC cited a June 12, 2014, government resolution dealing with unauthorized construction to claim regularization could not be done.

The court has issued a notice to the state to know its stand on unauthorized structures in the compound.





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VOTERS' CAUSE - NGO to parties: Back residents of dilapidated bldgs





In the near future, at least three lakh families will be rendered homeless when old and dilapidated buildings in the suburbs are declared dangerous and then demolished.

NGO Janhit Manch has taken up the cause of these families as there is no state policy nor any legal provision to provide them with alternate accommodation or ensure they get a new flat.

The NGO has written to all political parties in Mumbai to address this issue in their political campaign for the assembly election.

"More than 7,000 families will be or are already dishoused as there is no provision of temporary shelter under any law and no guarantee of permanent home in future," said Utsal Karani, secretary , Janhit Manch.

Karani said in 1998 Afzalpurkar Committee set up to give recommendations for re pairs and reconstruction of dilapidated buildings in the suburbs and extended suburbs of Mumbai estimated that there are 19,000 dilapidated buildings in the suburbs.

"At an average of 15 families per building, it works out to three lakh families that will be affected," he said.

So far, 580 buildings have been declared as C1, or dangerous, across Mumbai, including private, both tenanted and cooperative housing societies, and those owned by BMC, Mhada and Railways, among others.Out of these, approximately 97 buildings have been declared as dangerous in the island city .And of these, 50 are owned by the BMC and other authorities.Most of the island city buildings are tenanted cessed buildings (around 47) and are protected under Mhada Act for repairs as well as reconstruction. In case of suburbs, 450 buildings are declared dangerous, of which 70 are owned by the BMC and other authorities.The remaining 380 are private buildings. Almost 90% of these buildings are non-cessed tenanted buildings that have no protection at all of any schemes under the Mhada Act andor the civic Development Control Regulations, said Karani.

"Around 125 buildings in the suburbs have been demolished. Most of the tenants belong to the low-middle-income group and are scattered across the suburbs. Since the law does not provide any protection, they are left at the mercy of landlords and builders,'' he said.

Karani further said since candidates are moving around seeking votes, this is the best time to highlight the gargantuan humanitarian problem.

 





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POLL KHOL SAWAAL A fun clip on election promises

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E-REGISTRATION OF PROPERTIES FINALLY ARRIVES IN MUMBAI





You can now go ahead and skip the long queues of the sub-registrar's office by simply registering your property online

People in Mumbai can now expect hassle-free registration of properties, with the launching of an online system to ensure transparency and offer people a seamless experience. E-registration of property was launched by the Maharashtra government on August 31, 2014, to facilitate easier and quicker registration. Earlier, it was possible to download only the necessary documents for registration.With this initiative, buyers and developers can now register a property online. It will not only save money and time of the buyers but will also help provide an efficient and transparent service. The entire process is online and works through a software. The document is filled online, which is then checked by the sub-registrar.Mayur Shah, managing director, Marathon Group, said "The eregistration is one of the landmark developments in the real estate sector.Until now, it was compulsory for the homebuyers to go to the office of the sub-registrar for the same.Homebuyers as well as the developers had to depend on the office hours of the sub-registrar."

Now, the homebuyer need not stand in queues or run to different offices for the paperwork. It's especially difficult for people looking for a property in areas away from their office or current residence. Now, the whole process can happen in the comfort of their homes. The procedure is simple as the homebuyer and developer have to provide the details of their identity through the Aadhaar card. The procedure for the online registration would be the same as that which is currently happening at the office of sub-registrar. The verification and authentication process will help developers know a true buyer. Eregistration will do away with fallacies of the buyers defaulting on the full amount payment of property or loans and selling it without prior information, to the developer. Thus, in many ways, e-registration will keep away malpractices, make the process of buying a house easier for the consumers and also facilitate increased buyer-developer trust.

Kaizad Hateria, corporate customer relations and asset class specialist, Rustomjee, explains that "The buyers will not have to worry about the properties not having NOCs and many such permissions, as the online registration mandates the developers to list them. UID numbers and thumb impressions of both, the buyer and developer, are mandatory for this process and are verified by the website instantly . These can be the parameters for the buyer to judge the developer and vice-versa."

The document would be sent to the sub-registrar's office, who would check and verify the document, measure the legality of the agreement and the authenticity of the buyer and the developer. It is only then that he will authorise the agreement and register it. Mohan Nagare, a software engineer and homebuyer said, "The fluidity achieved by the system is commendable. It is less hectic, less energy-consuming and saves time.Also, it is easy to understand and is user-friendly . Now, online registration can be done within an hour, from the online property registration office of the developer."

Endorsing the view that the buyers will benefit the most, Gaurav K Shah, director-marketing, Ravi Group, says, "It will definitely bring in a positive change and is a hassle-free approach to registration of properties online.Buyers willing to buy property , do not have to wait in a queue to visit registration offices to get hard copies of the transactions. Technology has solutions for every doubt raised.Whether the property is stuck in a legal tussle, or the land is reserved for SCSTs, nobody can lie to the government at the time of registration. This process will put an end to illegal registration of properties."

Developers can have a customised registration facility for a project with more than 200 houses. The registration can be done from the developer's office and the whole process doesn't have to be repeated multiple times for all the buyers buying in the project. This makes the developer's job much easier vis-a-vis having to arrange for every individual buyer's registration. Shah explains that "The system works fluidly across the buyer-developer-subregistrar triad. The details of the property , the buyer, and the developer, need to be entered, along with the UID number and the respective thumb impression associated with the UID.It gets verified in the system. After this, one can digitally sign them and authorise the document to be processed further for registration."

The register-from-office facility is only available to developers who have all the required clearances for their projects and the necessary hardware and software. This saves the industry from a lot of fraudulent or irresponsible developers. This online channel for the electronic registration of transactions has a new range of services like interact with the land register including the digital map, circulate documents in a secure environment, pay fees by variable direct debit. The e-registration website also has a registration fee calculator, wherein, one can just input all the required numbers and it gives you the amount you need to pay . Apart from this, they have also included an automatic calculation of the registration fees while filling the form.

QUICK BYTE

THE HOMEBUYER NEED NOT STAND IN QUEUES OR RUN TO DIFFERENT OFFICES FOR THE PAPERWORK. IT'S ESPECIALLY DIFFICULT FOR PEOPLE LOOKING FOR A PROPERTY IN AREAS AWAY FROM THEIR OFFICE OR CURRENT RESIDENCE. NOW, THE WHOLE PROCESS CAN HAPPEN IN THE COMFORT OF THEIR HOMES. THE PROCEDURE IS SIMPLE AS THE HOMEBUYER AND DEVELOPER HAVE TO PROVIDE THE DETAILS OF THEIR IDENTITY THROUGH THE AADHAAR CARD.

THE PROCEDURE FOR THE ONLINE REGISTRATION WOULD BE THE SAME AS THAT WHICH IS CURRENTLY HAPPENING AT THE OFFICE OF THE SUB-REGISTRAR.

PROCESS

Go to igrmaharashtra.gov.in, click on e-registration, fill out required details and get your token number, click next.

Enter your property details, click next.

Enter party details as licensee or licensor.

Enter identifierwitness de tails.

Enter rentother terms.

Execute You will need to up load the thumb impressions and photos of every party along with the UID numbers; the document can be signed electronically with the help of software available for down load on the website.

UID verification UID numbers and thumb impressions will be verified.

Submit Submitted documents will be verified by the sub-reg istrar office and registered.

[FAST FACT]

THE DETAILS OF THE PROPERTY, THE BUYER, AND THE DEVELOPER, NEED TO BE ENTERED, ALONG WITH THE UID NUMBER AND THE RESPECTIVE THUMB IMPRESSION ASSOCIATED WITH THE UID.

 





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BMC GETS 6 WEEKS - `Decide on redevpt of dilapidated mkts'





Expressing concern over the dilapidated old municipal markets, the HC has asked the BMC to take a decision on proposals to develop the civic markets in Andheri and Santa Cruz. A division bench of Justice Anoop Mohta and Justice F M Reis struck down the corporation's orders rejecting the redevelopment proposals on the ground that it was in the process of revising the existing policy . The court said that the corporation could not halt the redevelopment citing proposed change in policy .

"There cannot be any dispute with regard to the pathetic conditions of the markets," said the judges. "If it is the corporation's obligation to redevelop and take control of such dilapidated buildings andor markets, then there is no reason for it not to take action based upon the existing poli cy at the earliest," the court said.

"All are concerned with the development of the markets which is essential part of the society. Most of the markets (see) huge crowds and movement of people of all sorts and age. The requisite facilities and safe buildings are the need of time.The policy decision to develop the markets only after the revised policy is submitted, in our view, is unacceptable submission and specifically when the existing policy nowhere gives this restriction to the corporation. They cannot postpone the development of the city , and specifically of the markets, merely because they have decided to change the policy," said the judges.

The HC has given the BMC six weeks to decide on the redevelopment proposals.





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39 years to get deemed conveyance





HC Relief For Jogeshwari Housing Society Thirty-nine years after they purchased flats in Jogeshwari, the Bombay high court has ordered deemed conveyance to the Farhat cooperative housing society.

"Since the owners having abdicated their obligation under the Maharashtra Ownership of Flats Act (MOFA) of conveying the property to the society, the competent authority has rightly intervened by passing the impugned order (of deemed conveyance)," said Justice R M Savant. The HC, however, struck down the deputy registrar's order that made deemed conveyance conditional on the final orders in a suit between the developers, Malkani Enterprises, and the land owners. The court said the litigation appeared to be a way to stop the society from getting deemed conveyance.

"The facts are very eloquent and therefore unmistakably lead to an inference that the suit has been filed by the owners merely to put obstacles in the society's way from get ting the deemed conveyance.

The suit has been filed without disclosing that a building having two wings, comprising around 60 flats, has already been constructed. The fact that Malkani Enterprises has virtually no rights remaining in the plot has been conspicuously kept away from the small causes court, and an order of injunction has been obtained against it," the judge said, adding, that making the order conditional "virtually made the grant of deemed conveyance ineffective".

The building was constructed in the mid-70s. The developer failed to form a society, which was set up by the flat owners themselves after 15 years. The plot's conveyance too was not granted. In 2006, the society issued notices to the developer for failing to grant conveyance and a criminal case was registered. In 2012, the plot owners issued notices to the developer cancelling the monthly tenancy as arrears were not paid for over 20 years. Subsequently, a suit was filed by the developers against the owners.

The HC said prima facie there was collusion between the developer and land owners to stop the society from getting conveyance. The owners will get six weeks to file an appeal.





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A simple life saving technique in dealing with kitchen oil fire

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For luxurious city flats, even owners shell out `rent

  Maintenance, Taxes Run Into LakhsMonth Fancy apartments in new luxury buildings not only cost a king's ransom, but also need a fortune to be kept in possession. Maintenance charges and municipal taxes can run into several lakhs a year because of amenities like swimming pools, club houses, elaborate security arrangements and property tax assessments at the highest rates. "It's like renting your own home," said a property market insider. Depending on size, a flat in buildings like Imperial Heights in Tardeo, Orbit Arya and Villa Orb on Nepean Sea Road, Raheja Vivarea in Agripada, and One Altamont Road can cost a home owner Rs 60,000 to Rs 2 lakh a month, as the monthly maintenance cost and property tax works out to as high as Rs 30 a sq ft. "It's a lifelong liability.They have to set aside a few lakhs every year, whether the value of their property appreciates or depreciates," said a real estate consultant. Imperial Heights, a twintower 60-storey complex, came up as part of a slum rehabilitation project and houses corporate honchos, bankers, top lawyers and expats. A resident said he pays Rs 70,000 a month in maintenance charges for his 3,450 sq ft flat. The amount will increase to Rs 1 lakh a month once the municipal property tax kicks in. For a first-time visitor to Imperial Heights in Tardeo, the twin towers' "unparalleled" security arrangements almost give the feeling of a defence establishment. Domestic helps are randomly frisked for tobacco, alcohol and more sinister objects, and CCTV cameras in the lifts, lobbies and corridors keep a hawk eye on mundane movements for fear that they may turn malevolent. More pleasant aspects include a climate-control swimming pool, a gym, a restaurant, a cigar room, a convenience store and a banquet hall. Not to mention guest houses serviced by the Taj. "We have not paid property tax for over a year as the society has challenged the BMC's levy. Once the matter is resolved, the monthly outgoing on a flat will increase substantially," said a resident. The complex also has 10,000 sq ft flats, whose outgoings are more than Rs 2 lakh a month. The other buildings follow closely. One Altamont Road, constructed jointly by developers Suresh Raheja and Govani, has 8,000 sq ft flats, where monthly outgoings are over Rs 1.2 lakh, not counting municipal taxes. Villa Orb on Nepean Sea Road, where Union minister Piyush Goyal (BJP), owns a flat, is another tower where monthly expens es are believed to be astronomical. Sources said the outgoings, without civic taxes, are Rs 18 a sq ft a month for flats of 5,500-7,770 sq ft area. Agripada's three Vivera towers command Rs 12 a sq ft, without taxes. A resident said the builder, Raheja Corp, has already collected a corpus from each flat owner: Rs 35 lakh for a 4BHK flat and Rs 22 lakh for a 3BHK one. Besides a club house, a swimming pool and a banquet hall, the amenities include billiards, badminton, squash and tennis courts, a health club, a recreation ground for children, a yoga centre, and air-conditioning for the entire building. Outgoings in smaller buildings with fewer flats are higher than in larger buildings with more flats as the maintenance costs get divided among more owners, said developer Abhisheck Lodha. Another developer said occupants of new buildings built with limited floor space index (FSI) because of coastal zone regulations pay more. "Flat owners in buildings with higher FSI incur lower maintenance charges because of more apartments." Property experts said municipal taxes on new apartments will increase by as much as 40% every five years. This is a factor why some prefer to buy flats in landmark buildings constructed four or five decades ago. Owners of large flats in old, plush buildings on Malabar Hill and Carmichael Road pay much lower amounts. In Pedder Road's Woodlands, a premium residential tower built in the 1960s, an owner of a 1,200 sq ft flat pays only around Rs 12,000 a month. Residents of Carmichael Road's Rushila, where flats measure 3,000 sq ft, pay a similar amount.The building came up in the mid-1950s. A resident of the 1960s-constructed Meher Apartments, Altamont Road, said outgoings are between Rs 7,00012,000 a month. The luckiest are flat owners in Jolly Maker Apartments 1, Cuffe Parade, a complex comprising two 25-storey towers with about 180 flats and 10 bungalows. Here, residents do not pay a paise. Touted as the country's richest housing society , Jolly Maker's flat owners get annual dividends of Rs 5-10 lakh from their housing society , which also pays civic taxes and maintenance charges. The reason for the society's huge cash pile is because it owns six floors in Nariman Bhavan at Nariman Point, which are leased out to companies. In the mid-1970s, the builder offered the Nariman Bhavan property as a package to buyers who paid 40% more for their flats.  

Deal Keeper

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Poll frenzy: CM clears realty projects worth `4,000 crore

160 individual schemes among those okayed in 15 days n Heritage tag off most of Chembur

Mumbai: Chief minister Prithviraj Chavan has cleared 160 individual development project files and taken major housing policy decisions, worth over Rs 4,000 crore, in the last 15 days. Not just that, the state government did so by glossing over a mandatory rule that calls for the provision of tenements to the economically weaker, if redevelopment is taking place on a plot of 4,000 sq m or above. Chavan also cleared a file that made almost all of Chembur heritage-free, leaving out only the St Anthony's Church, the Jain temple, Leprosy home in Trombay and some bungalows in Deulwadi. The speed at which Chavan has cleared the files contradicts his earlier stand of keeping builders at bay. The clearing of files at record speed, predictably, failed to impress the BJP. It alleged that most of the transaction amount is likely to be used as party funds for Congress candidates during the upcoming assembly elections on October 15. The BJP said it will relook the files, if voted to power. Chavan was unavailable for comment. What are the files that have been cleared? Among the major files to be cleared were the ones relating to cluster development, slum rehabilitation policy for Thane and floor space index (FSI) of 2.5 for Navi Mumbai. Is the decision loaded in favour of developers? The rules mandate that if redevelopment is taking place on a plot of 4,000 sq m or above, tenements will have to be provided for the economically weaker section. However, while clearing the 160 files, this clause was not considered. According to real-estate experts, "the (mandatory) decision would have created sufficient affordable housing stocks for Mhada but developers' profit margins would have been slashed. Now, developers will be benefited a lot. " What is the BJP's argument? Vinod Tawade, senior BJP leader, told dna: "By clearing files hurriedly before the election code of conduct sets in, Chavan has raised the required party fund. We will reopen all these decisions if we come to power." What are builders saying? Obviously they are happy. Sunil Mantri, president of the apex developers' body, NAREDCO, told dna: "I expect elections every three months, so that no files get stuck. Most files have been pending for several months. Thanks to the elections, they were cleared." What if the BJP reopens files as they say? A prominent developer from South Mumbai told dna that chief minister Chavan might have raised funds for his party, but it also benefited developers. "We are worried that the BJP is saying it will reopen files, if voted to power. If that happens, we will lose our money and our projects will be delayed. To get the files cleared again, we have to pay again." What's the Chembur issue? The heritage tag has finally gone off almost the entire Chembur. Only the St Anthony's Church, Jain temple, leprosy home in Trombay and some bungalows in Deulwadi have been left out. Even the Gaothan area has been cleared of the heritage tag. A government regulation will soon be issued. It would have faced a delay of over two months, had Chavan not cleared the file before the poll code of conduct became operational on Friday. Chembur MLA Chandrakant Handore confirmed the move. "The CM cleared the file yesterday. Chembur is purely a residential area, so there was no need to give a heritage tag to it. However, we are happy that the tag has been removed," he said. When did residents start protesting? When they first came to know that the area will be included in the heritage precinct list, an association called Chembur Citizens Forum filed a writ petition with the Bombay high court. The high court, on March 27 this year, ordered that, in two months, a review committee should be formed to present a report. What happened then? A review committee headed by former chief secretary Dinesh Afzalpurkar took suggestion/objections of the residents and compiled a report to strike off more than 500 buildings off the heritage list in Chembur. The report was then sent to municipal commissioner Sitaram Kunte. Kunte recently forwarded the report to the urban development department. The department then sent the file to Town Planning department for their remarks. The CM finally cleared the file on Thursday.

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How to invest in property with Rs 2 lakh





You no longer need deep pockets to invest in property. Find out how Reits will help you participate in the real estate market

If you have Rs 2 lakh to invest, your bank may roll out a red carpet, your stock broker may inundate you with hot tips and the neighbourhood jeweller may even offer a discount on making charges. However, you will probably get laughed out of the estate agent's office.Not anymore. With Sebi issuing final guidelines for real estate investment trusts (REITs), you will soon be able to get a piece of the action in the property market with as little as Rs 2 lakh.

REITs are just like mutual funds, but instead of using the money collected from investors to buy stocks and bonds, they invest in property .Last month, the Union Budget removed an important hurdle by giving pass-through taxation status to REITs. Last fortnight, Sebi issued the guidelines, settling several of the concerns raised by the real estate industry . The launch of REITs will increase the flow of funds to the cashstarved real estate industry . "Even if half of the currently available Grade A office space gets converted to REIT and is listed in the next 2-3 years, it can mean an inflow of Rs 60,000-72,000 crore," says Anuj Puri, chairman and country head, JLL India.High entry barrier Whether you invest in a residential property or commercial space in a metro or tier I city, the minimum investment is normally upwards of `30-40 lakh. Sebi's guidelines for REITs have pegged the minimum investment at Rs 2 lakh, which will allow retail investors to participate in the real estate market. In the secondary market, the minimum holding could be even lower at Rs 1 lakh. "REITs will allow even middle income individuals to invest in real estate. Without this, they can't participate because of the huge entry barrier," says Keki Mistry, vice-chairman and CEO, HDFC. The low ticket size means that investors can diversify their portfolios by including real estate without investing huge amounts in the asset class. The high entry barrier is not the only problem with investments in real estate.With no real estate regulator in place, individual investors are at the mercy of politically connected builders in India. If, however, they invest in a REIT, they will be able to join hands and get bargaining power against the developers.

The other benefit is diversification. When one invests in a real estate project, the returns are dependent on how well that project is received in the market and the rental income it is able to command. On the other hand, REITs invest in several projects and, therefore, provide the benefit of diversification to the investor. With a low entry barrier of Rs 1 lakh in the secondary market when units are listed, an investor can spread his investment across 3-4 REITs launched by different asset managers. The liquidity offered by REITs is another positive feature of this mode. While selling a property can take weeks, even months, REITs will inject liquidity into the investment by listing the units on the stock exchanges. The day is not far when one will be able to buy and sell property at the click of the mouse.How attractive is the investment?
While Sebi has given the go-ahead to REITs, right now they can invest only in commercial real estate. This narrows the scope considerably because most of the action in the sector is in residential real estate. Even in commercial projects, 80% of the investment must be in rent-earning projects. The balance 20% can be in other assets, including projects under construction (restricted to 10% of the total REIT assets), listed or unlisted debt of real estate companies, equity shares of real estate companies having 75% income from realty activities, government securities and money market instruments.

Though some may see this as an unnecessary restriction, the straitjacket of rental yielding projects is actually a blessing in disguise. First, there is major difference between rental yield from commercial and residential properties in India now. "While rental yield on commercial property is slightly lower than the interest rate, the one on residential property is very low. So REITs will not work in the residential market now," says Mistry . If rental yield from commercial projects is less than the prevailing interest rate, why should one consider investing in REITs? "The rental yield is not very attractive now, but is expected to rise in the future," says Ujwala Rao, national director, capital markets, JLL.Besides, there is always the possibility of capital appreciation that will push up the NAV .Bottom of the cycle Still, there are several factors that investors need to keep in mind. As of now, the commercial real estate market is in doldrums. "In several pockets, the price of commercial real estate is around 30% cheaper compared to residential real estate," says Kapoor. Though there is an escalation clause in most commercial real estate projects, it is a users' market and, therefore, they are able to renegotiate the rents downwards. This also means that commercial real estate is reasonably priced right now. There is a greater scope for appreciation. As the economy picks up momentum and commercial activity increases, things are likely to improve. "This is the time to get into commercial real estate because it is at the bottom of the cycle," says Kapoor. Other experts join the chorus of optimism. "For REIT to work, you need a buoyant real estate market. Nothing much had been happening in the past 3-4 years, but things have started picking up now," says Mistry . "Commercial real estate is linked to economic recovery . Rentals may remain under pressure for the next 12-18 months given the oversupply , but with the speed of supply moderating in the coming years, the situation should improve," says Mittal.Taxation of REIT income This was the biggest bone of contention for REITs. The recent budget offered some relief when the finance minister announced that REITs will be a pass-through vehicle. In the earlier structure, both the trust as well as the investors had to pay tax. Now, the trust will not pay tax on income. Only the investor will be taxed when he gets the income or sells the units. However, experts warn that this pass-through benefit is not applicable to all types of incomes from the REIT (see table) "The pass-through benefit is only for interest income earned by the REIT from its special purpose vehicle (SPV). As of now, there is no pass-through for rent or other income received by the REIT from property directly held by it," says Sriram Govind, core member of the international tax team, Nishith Desai Associates. He says the REIT has to pay corporate tax on such income earned by the SPV . Similarly, the REIT will also have to pay capital gains tax on sale of shares of the SPV . There is also no relaxation on the dividend distribution tax on payouts by the SPV to the REIT," says Govind.Though the dividend received from SPVs is taxfree for REIT as well as investors, the SPV would have already paid corporate tax and dividend distribution tax on such income. Factor this tax into the calculation of returns from REITs.

Though the dividend distribution tax is a prickly problem, what more than makes up for it is the treatment of capital gains from the REIT.Since there is a securities transaction tax (STT) on the listed REITs, the long-term capital gains will be tax-free while short-term capital gains will be taxed at a concessional rate of 15%.

However, you need to hold the REIT units for at least three years to qualify for long-term capital gains. In addition, the investor has to pay tax on part of the income received during the period. "The listed pass-through vehicles are at a tax disadvantage," says Feroze Azeez, director, Investment Products, Anand Rathi Private Wealth Management.

Since some of the income from the REIT will be tax-free and some other will be taxable, the big question is, how will investors know the difference? "There will be some reporting mechanism and the break-up will come at the time of income distribution from the REIT," says Rao of JLL.

Interestingly , REITs offer a better deal to NRIs on the tax front. The withholding tax for them is only 5% compared to 10% for resident Indians.And the amount received may be tax-free for them, at least in most countries, while the Indian investors have to pay tax based on their slab rates. If the NRI has to pay tax on the income in the country of residence, he can claim this 5% as a rebate.What are the risks?
The biggest risk can come in the form of developers keeping their prime rent-earning properties and dumping their not-so-good assets on REITs. Though there will be professional valuers, the real estate market is notorious for its opacity . It is still a builder's market and the investors don't have any access to the valuation process. Though the introduction of REITs is expected to improve the situation, the lack of transparency and the black money component in the real estate deals is another possible risk.Finally , there may be stable regular income, but the capital appreciation or depreciation depends on the market price of commercial real estate and, therefore, will be volatile.

Sebi's guidelines for REITs is only the first step. There are bound to be teething problems when the market starts functioning. However, this has paved the way for a more vibrant market for real estate. If you want to invest in real estate but don't have deep pockets, you can consider REITs as the vehicle that can take you there.

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Mafatlal gets 100% TDR for roads on its Chembur plot



Clearing the decks for Mafatlal to redevelop its sprawling plot in Mahul in Chembur, the Bombay HC has directed the BMC to grant the company 100% Transfer Development Rights for the public roads it has constructed on the land. A division bench of Justice Anoop Mohta and Justice Ajay Gadkari struck down as illegal the corporation's decision to revoke the letter of intent (LOI)—the initial clearance for the redevelopment project—granted to Mafatlal.

"(Mafatlal's) entitlement just can't be denied once it is es tablished, and there are documents on record to show, that they completed work as required and accordingly handed over the site to the BMC's officers," said the judges. The BMC had claimed there was a delay in completing the road construction and now whatever was done by the company was unauthorized.

The HC, however, pointed out that the BMC itself had issued approvals for the road and after the company surrendered the civic amenity , the corporation had taken it over.

As per the policy , Mafatlal constructed the road and even paid over Rs 54 lakh for sewer lines and other facilities. Following a 2009 Supreme Court judgment, Mafatlal sought 100% TDR for the public road it had constructed at its own cost.

`Take back land given to Videocon' idco has been allowed to C take back 100 hectares of land allotted to Videocon at Navi Mumbai in 2008 to set up a TFT-LED plant. The state cabinet has taken the decision due to delay in setting up the plant. A release issued by the CM's office said Cidco required the land for several important projects and hence the decision. TNN

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State ordinance clears hurdles for conversion of land use





To ensure that there are no hurdles for conversion of land use from agricultural to non-agricultural, the state government has issued an ordinance amending the Maharashtra Land Revenue Code, 1966.

Section 42 of the MLRC requires permission from the collector for non-agricultural use.With the ordinance the state has done away with the requirement. This is because the process is cumbersome and had led to a rise in use of land for other purposes without the collector's nod.

Under the new amendment, in urban areas, if a plot is part of the development plan or the draft development plan sanctioned under the Maharashtra Regional Town Planning Act, then the collector's permission is not required. But the planning authority will need to ascertain its occupancy and any encumbrances and thereafter sanction development permission.

In August 1999, the state had issued a government resolution for conversion of land use. But as the Act was not amended, the notification could not be implemented. This time, after the cabinet approved the proposal, the earlier GR was cancelled and in its place the ordinance has been issued. It is one of the last ordinances signed by governor K Sankaranarayanan on August 22. He resigned from office on August 24, after he was transferred as Mizoram governor.





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Over 2L flats remain unsold due to demand-supply gap





The unabated demand-supply gap in the residential property market has created a pile-up of 2,13,742 unsold units, according to a Knight Frank India report released on Tuesday . The unsold inventory could take almost three years to sell.

The half-yearly report, India Real Estate Outlook,analyses the residential and office market performance in the Mumbai metropolitan region (MMR) between January and June 2014.

Demand in the region dropped by a whopping 25% during this period in comparison with the same period last year. "Buyers continued to sit on the fence for the most part of H1 2014 in anticipa tion that the new and stable leadership at the Centre would revive the ailing economy ," it said The most expensive location (south Mumbai) accounts for less than 1% of the 4,47,294 under-construction units in the MMR. " A comparison with all other micromarkets in MMR shows that the inventory level in south Mumbai market will take maximum time of 18 quarters (4.5 years) to sell," it said.

Central Mumbai, on the other hand, emerged as a prominent residential market on the back of premium residential and social segment and corporate headquarters from manufacturing, media and consulting sectors. It will take almost four years to clear the inventory that has been in the market for the past nine quarters.

The western suburbs saw a 19% jump in new launches compared to 12% during the same period last year. This belt has an unsold inventory of over three years.

With developers deferring fresh launches, new project completions dropped by 25% in H1 2014 compared to the same period last year.





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New TDR policy to bring down property prices

Mumbai: Property prices are set to come down, with the state deciding to increase its share in the Transfer of Development Rights (TDRs) market from 0.33 to 0.67 in the suburbs. In other words, the government has restricted the land available with private builders for TDRs. The amended TDR policy will be released soon. Though widely seen as a pre-poll sop, many developers have welcomed the move. The rise in the state government's share in the TDR market will bring more revenue into its kitty and also the Brihanmumbai Municipal Corporation (BMC). The civic body can utilise this earned revenue for various infrastructure projects. What exactly is TDR? TDR means Transfer of Development Right. Supposing you own some property in Borivli. If the government declares it as reserved land (either to be used as a garden or as a heritage property), you may lose control over that property. But the government will compensate you by issuing TDR. Though the government generally issues TDRs on reserved land, it can issue TDRs on other land also, if it wants. How will it help? TDR will enable you to sell to builders an equal area of the land you've lost. Only, this is a virtual space market. Here, you are actually not selling land that you own, but selling an equal area of virtual space for real space lost. You're selling a certificate and getting compensated for the land lost. When builders start selling and buying them, an open market is formed. How will increase in TDR reduce prices? Earlier, the government's share in the TDR market used to be 0.33 and the open market share was 0.67. Since the bigger percentage was with private players, the government had lesser control over prices. Private TDR holders used to increase prices artificially and manipulate market. By reversing the ratio, the government will have a better control of the market and real-estate prices. What are TDR prices like? At present, TDR is sold between Rs3,500 to 5,000 per sq ft. Once developers start getting TDR at reasonable rates from the government, their input costs will come down. There will no supply constraints. Automatically, property prices will also come down. But they are far lower than land prices... Yes. The TDR prices are far lower than the actual land price. The logic is to compensate for lost land with something, rather than nothing. What are builders saying? Though property prices going down is not good news for builders, they welcome this move as it would bring stability to the real-estate market. Price rise beyond a certain level will only lead to piling inventory and it will not really help developers. Says Sunil Mantri, chairman of National Real Estate Development Council (NAREDCO), developers umbrella body: "This will bring stability." How's the scene abroad? According to Mantri, every major world city has an FSI (Floor Space Index) of more than 4. FSI is the creation of addition space by building more floors.

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Entire Backbay may be opened up for development





The Mahim shoreline is not the only stretch in Mumbai to be declared a bay by the state coastal authority , opening it further to construction.
The entire Backbay area, extending from Nariman Point and Cuffe Parade to Girgaum Chowpatty , has also been classified as a bay based on a report by the National Hydrographic Institute in Dehradun.

The shift in nomenclature, effected earlier this year, could create a bonanza for builders in south Mumbai in the months ahead. The state urban development department and the BMC are already grappling with the prospect of seeing large parts of Mumbai's coastline open up to rampant construction due to the process of redefinition. Till 2011, Coastal Regulation Zone (CRZ) norms had restricted construction activity up to 500m from the sea's high tide line. But an amendment in that year reduced the minimum distance for construction activity near a bay from 500m to just 100m, while retaining the old protection for seafronts.

3.5-acre plot freed, P 5 Taking advantage of the change, many Mumbai builders with prime plots near the coast rushed to the National Hydrographic Institute and the Institute of Remote Sensing (IRS) in Chennai. The institutes reportedly certified several areas as bays and marked out the plots as being outside the 100m zone.

The director of hydrography clarified that Backbay has been depicted as a bay on the institute's official navigational charts. Based on this classification, the Maharashtra Coastal Zone Management Authority (MCZMA), earlier this year, green-lighted construction on a 3.5-acre plot in Gamdevi, which earlier fell within the 500m CRZ protection line. The builder is rumoured to be developer Sudhakar Shetty. He could not be reached for comment despite several attempts by TOI.

"The builder got a favourable mention in the minutes of the MCZMA, which put his plot close to Girgaum Chowpatty out of the purview of CRZ," said a source.

Debi Goenka of the Conservation Action Trust said the shorelines in Mumbai could technically be defined as bays. "The problem is with the Union environment ministry, then headed by Jairam Ramesh, which allowed CRZ restrictions for bays to be reduced from 500m to 100m," he said. Architect and housing activist P K Das warned any attempt to dilute CRZ will lead to "development anarchy".

Government sources al

leged the MCZMA was selectively granting environmental clearances to some plots.

As reported by TOI on July 24, the urban development department and the BMC objected to the MCZMA clearing building projects by removing them from CRZ on the basis of the new bay definition. The state government stayed the coastal authority's approvals.

But R A Rajeev, the IAS officer who was removed as state environment secretary (he was chairman of MCZMA) last week, said the authority did not take any controversial decisions. "The MCZMA approved projects based on reports by the hydrographer and authorized agencies of the environment ministry. The authority sim

ply followed their observations on the demarcation of these plots," he told TOI.

"We did not pick and choose cases. Every project was scrutinized. Some were cleared by the Bombay high court," said Rajeev, adding that there were 15 such cases in the pipeline.

A new coastal zone management plan (CZMP) for Mumbai is currently being prepared by IRS Chennai.

Builders whose plots abut Backbay are waiting anxiously to free their plots from CRZ.

"They are hoping the draft CZMP plan would be approved by the National Coastal Zone Management Authority and published accordingly, showing these areas as a bay," said a source.

TIMES VIEW: It's ultimately experts who will determine whether these areas qualify as bays or not. But there is something drastically wrong in the law and the process if a mere change in nomenclature of an area can mean so much of difference in terms of development. Mumbai is already bursting at its seams and can barely provide the infrastructure its residents need; it's imperative the city gets a dose of planned development.

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THE WORLD AT YOUR FEET - High income, low tax... House that!





Buy that new penthouse, reap lakhs in tax savings. Here's how the math works

The upside of being a `high-net-worth individual' (HNWI) is that you get a fatter pay cheque than most people.
The downside is that a big chunk of it will be taken away by the taxman. But there are ways of getting around that; in fact you can save a lot of tax by buying a house -as long as you let it out and not live in it.

Kuldeep Kumar, executive director of PricewaterhouseCoopers, says that's because, under Sec tion 24 of the Income Tax Act, you are al lowed deduction of the entire interest payment on your home loan from your taxable income -provided you club the rental income from the house with it.

After the new Budget, home buyers are allowed a deduction of Rs 2,00,000 on interest payment of their home loan. But no such limit exists if you can show your purchase as an investment, and not for personal use. The tax benefit is huge, says Vivek Jain, a senior chartered ac countant. If you are wonder ing how, the math is simple: with interest rates at around 10% per annum and rentals from a residential property hovering around 3% of capital value even in the metros, your actual outgo amounts to about 7% every year. This "net loss" is what you can rightfully claim as deduction from your taxable income.

LOSS IS GAIN

Here's how the calculation works out. Let's say you have an income of Rs 1.20 crore per annum, putting you in the 33.99% tax bracket. You buy a house worth Rs 3.30 crore for which you pay Rs 30 lakh up front and get financing of Rs 3 crore from a bank. At 10% interest rate, your EMI will be Rs 2,89,506. In the first year, your total payout will be Rs 34,74,072 -Rs 29,77,656 as interest payment and the rest towards repayment of principal. Going by market trends, your annual rental income would at most be Rs 11,50,000, or 3.5% of capital value. After deducting 30% as maintenance expense, your net taxable rental income will be Rs 8,05,000 (70% of 11,50,000). Deduct this from the interest amount (Rs 29,77,656) and your "net loss" stands at Rs 21,72,656. This amount will be deducted from your taxable income, reducing your tax liability by as much as Rs 7,38,486.

RETURNS OF RENT

With part of EMI being used to pay the principal, the interest burden will decline with each year; the second year, it will be reduced to Rs 29,25,675.
With rental income rising by , say, 5% during the period, the net loss will come down to Rs 20,80,425 and you get to save Rs 7,07,136 as tax in Year Two.
Interest amounts will fall further but a simple calculation shows that even if rentals keep increasing at 5% CAGR, your income from rent will exceed your interest outgo only in the 15th year.

FLOOR POWER

Buyers who are yet to get possession of their flat stand to gain as well, says Kumar.
The entire accumulated interest payout during the construction period can be claimed as deduction over the next five years once possession is taken.

After 15 years, you can sell the house and reinvest the money in a new one. Of course, you can always invest in more than one property and save even more tax. All it takes is an even fatter pay cheque.

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Nariman Point-Kandivli coastal road goes to BMC

After nearly two years of dithering, CM hands the file back to the civic body n Project cost estimated at Rs8,000 cr n BMC has raised Rs3,500 cr from fungible FSI

Mumbai: Ending ambiguity over who will execute the multi-crore coastal road project, the state government has confirmed that the Brihanmumbai Municipal Corporation (BMC) will undertake the ambitious venture. MMRDA was the other contender. Speaking to dna, chief minister Prithviraj Chavan said BMC will execute the project now. "The BMC will work on the project... we have permitted BMC to collect revenue in lieu of fungible floor space index... If need be, we will chip in with funds," he said. First, what exactly is this fungible FSI? Fungible means interchangeable. Imagine, you are buying a flat. Developers will charge you for ornamental features like lobby, lift space, flower bedsetc. The developers were not sharing this money with the government. They were called free-of-FSI (floor space index) component. Now, the government charges a premium from developers for such space. The money so collected will be exclusively used for coastal road construction. To compensate the developers, the government gives them additional FSI or additional area for the premium collected. Now, what's the coastal road project? It's a 35.6-km road from Nariman Point to Kandivli, which runs parallel to the coast. The road will start from Manora Guest House, opposite Mantralaya, and progress through a tunnel between the NCPA and the Air India building. Nearly 8 km will be on reclaimed land. It will also have elevated roads. There will be 18 exit and entry points. What's the project cost? Given the route along the coastline, the BMC has two options: to reclaim land from sea or to build road through mangrove patches. The first option will cost Rs8,000 crore, and the second Rs7,000 crore. How will it help me? The minimum average speed on city roads has come down from 18 km per hour to 8 km per hour due to rise in vehicles and congestion on roads. As far as the coastal road is concerned, motorists can drive at 90 km per hour. Where will the money come from? The BMC has so far collected Rs3,500 crore as premium recovered in lieu of fungible FSI. "We have set a target of Rs2,000 crore in a fiscal. To meet that target, developers will have to undertake a specified number of projects in a year," an official said. Why a Cong-led govt chose Sena-led BMC Though this is a pet project of chief minister Prithviraj Chavan, he's willing to cede ground here. The logic is that since the Sena-BMC combine is ruling the Centre as well, clearances will be smooth. Recently, Chavan had met Union environment minister Prakash Javadekar to discuss environmental clearances. The latter appeared positive on putting the project on fast-track. Does the BMC enjoy any edge over MMRDA? It's a multi-crore project, requiring huge monetary investment. So, the government thinks the BMC has the resources that no other agency has. When was the project conceived? The wheels started rolling when the Chavan cabinet issued a government resolution on June 30, 2011, forming an 11-member joint committee, under the chairmanship of then civic chief Subodh Kumar. The panel consisting of architects, urban planners and experts in oceanography submitted the report to the government on December 29, 2011. What's the status now? Feasibility study is on now. In February this year, the BMC appointed a consultant (a consortium of Stup and Ernst and Young consultants) to carry out a feasibility study with the roads department. The consultant will suggest the best way to carry out the project and also a cost-effective model.

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168mn sq ft unsold in Mumbai Metropolitan Region

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 Mumbai Metropolitan Region (MMR) has an unsold inventory of 168 million sq ft. These apartments will take 45 months to sell, a large time lag considering it should not take more than eight months to a year. The data comes from the latest Liases Foras report released on Thursday . "This huge unsold inventory is a clear indication that buyers cannot afford high property rates,'' said Pankaj Kapoor, head of this real estate research firm. MMR comprises Mumbai, Dahisar to Virar, Thane, Navi Mumbai, Dombivli, Kalyan and Diva as the main centres. The weighted average price in MMR is Rs 13,012 a sq ft, which was hovering around Rs 12,748 a sq ft in the last quarter. The report also revealed that sales dipped by a marginal 2% from the last quarter. Most new projects launched in the present quarter had a price tag of over Rs 2 crore for an apartment. "We predict prolonged inefficiency, prices have to reduce for demand to increase. Sales won't improve till prices reduce,'' said Kapoor. Earlier, prices increased 7-8% per quarter. "This is not happening now. It's a stagnant situation,'' he added. "The year 2014-15 began on a rather muted note with a 9% sequential decline in area sales across six major cities in India. With an exception of Bangalore, all tier I cities have shown a drop in sales. The city registered a 10% growth in sales for the quarter,'' said the report. NCR led with a 20% decline, followed by Chennai and Hyderabad with 18% and 13%. MMR, however, was almost stagnant with a meagre 2% drop in sales. For the first quarter of 2014-15, sales in Bangalore have been the highest, followed by NCR and Pune. "Most sales in the city can be attributable to new launches in peripheral regions. But the performance in the secondary market has been average in the city,'' it added. The cost range for new launches has been fragmented across the cities. In NCR and Pune it has been the affordable segment, while in Bangalore it has been the mid-segment. At the same time, MMR showed increased level of activity in the affordable and ultra-luxury segment.

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