It’s easily a 15-year wait for homebuyers in Delhi-NCR
When Pankaj Gupta gave the down payment for his dream home in Jaypee Wish Town’s Kensington Park Apartment project in 2010, the person on the other side of the desk had promised delivery of the flat within three years. He was sure then that his two children were going to grow up in that house. Cut to 2018, and Gupta is now hoping to get that home by the time his children graduate from college.
It might take anything from 15 years to two decades for 70,000-odd homebuyers in the Delhi-National Capital Region (NCR), especially in troubled real estate projects of Amrapali Group, Jaypee Infratech (JIL), and Unitech. The same is the case with another 40,000 buyers spread across hundreds of smaller projects. Most of these projects are stalled due to lack of funds, leading to litigation.
What is being termed as a real estate bust in Delhi-NCR, once a land of promise for investors as well as homebuyers, is an outcome of throwaway land prices combined with greed and a complete disregard of law, according to analysts. The realty crisis in the satellite cities of Noida and Greater Noida had a flawed foundation, they pointed out.
The data sourced from real estate broking and advisory firm Anarock shows that out of 240,000 units expected to be delivered in 2017 in the NCR, only 62,600 were given for possession. Approximately 87,300 units of the undelivered residential units were in Greater Noida, followed
by 30,200 units in Ghaziabad, and 25,400 units in Noida.
“Further, the cash crunch due to siphoning off of funds by developers for other projects, tweaked project details to bypass environmental/regulatory clearances, changing norms, the water and sand crisis, and bureaucratic snarls are other key reasons for project delays in the NCR. As many as 180,000 units in the NCR missed the 2017 deadline, which are either under litigation or have been stalled due to other reasons,” Anuj Puri, chairman, Anarock Property Consultants, said.
Jaypee Infra’s failed promises Almost 30,000 homebuyers of the various stalled projects of JIL have been running around the corridors of the Supreme Court (SC) as well as the office of resolution professionals to get the work started. However, with no concrete relief in sight, homebuyers have been left to find the means to pay equated monthly instalments for a flat that has been pending for years as well as manage a rent.
“Even if they start the work on my project today, it will take almost five years to get done. The petition is still going on in courts. The 2,000-plus homebuyers of the project are yet to receive flats,” Pankaj Gupta said.
Sources close to JIL claim otherwise. They said the company received completion certificates for 10,790 units till June. Further, 2,993 units have been submitted for completion certificates. Sources claimed that since August last year to date, the group has completed an average of 500 flats per month. This is a combined figure of JIL and Jaypee Associates since the Wish Town project is divided between the two companies.
Amrapali homebuyers pin hopes on NBCC
After getting directions from the Supreme Court, governmentowned National Buildings Construction Corporation (NBCC) has decided to take over the Amrapali as well as the Jaypee projects. It may invest around ~150 billion into the two stalled projects. However, till the time work begins at the sites, nothing is quite certain. NBCC would submit a report to the SC on this in September.
The court, which has been helping around 70,000 homeowners get relief, had recently hauled up Amrapali group for playing ‘fraud’ and ‘dirty games’. It also ordered attachment of all bank accounts and movable properties of 40 firms of the real estate major.
“Almost no work has started in the project that I have bought a flat in. Even if NBCC starts the project in six months, there is no way they can complete everything in two years,” said one of the buyers.
Some others have already bought another house and want the courts to help them get their money back. At the moment, the courts would prefer the work in the projects to start rather than arranging for refunds, they said.
Unitech’s fight to regain lost glory
According to a senior executive at Unitech, the company has been able to deliver about 1,000 flats in the last six to eight months. It needs to do the same for 15,000 more homebuyers, he pointed out. The company has been trying to get funds and is in talks to sell its land bank and auction some of its property in Uttar Pradesh. It has also been trying to rope in a private equity fund. At this point, it has around five to six stalled projects in Gurugram and roughly the same number in Noida.
Unitech’s managing director Sanjay Chandra, in an interview to Business Standard last December, said his top three priorities were swiftly accelerating construction universally, generating the necessary capital from the sale of surplus land or assets, and recovery of funds from various state governments.