Builders have to think smart

In­no­va­tions in hous­ing are the way out to lever­age in­crease in land costs, says Van­dana Ram­nani

HT Estates - - Front Page -

Land prices are ex­pected go up by a whop­ping 70% if the new Land Ac­qui­si­tion Re­ha­bil­i­ta­tion and Re­set­tle­ment (LARR) Bill 2011, meant to re­place the 117-year-old Land Ac­qui­si­tion Bill of 1894, be­comes an act. What course of ac­tion will then be open to de­vel­op­ers? Will they have to switch from af­ford­able hous­ing to ex­pen­sive high-end res­i­den­tial units or will they man­age to launch low-bud­get ac­com­mo­da­tion through in­no­va­tive con­struc­tion tech­niques?

Gaur­sons In­dia Lim­ited is plan­ning to launch 500 units in the mid-seg­ment and up­per-mid seg­ment in Noida Ex­ten­sion area once the land ac­qui­si­tion is­sue in the area is re­solved. “These would range from 2000 to 4000 sq ft and cost around R2700 to R3000. This will help us lever­age costs to some ex­tent,” says Manoj Gaur, man­ag­ing di­rec­tor, Gaur­sons In­dia Lim­ited.

Aj­nara Group will also “def­i­nitely” look at launch­ing prod­ucts in the mid-seg­ment cat­e­gory once the land row is re­solved.

Land costs have a huge bear­ing on the prices of res­i­den­tial prod­ucts. For de­vel­op­ers, the so­lu­tion lies in the govern­ment in­creas­ing the FSI and al­low­ing them to build more on the same piece of land, thereby cush­ion­ing costs and not in­creas­ing unit prices. “This will help us build more saleable area with­out the end-user be­ing im­pacted in any way,” says Prashant Solomon, joint man­ag­ing di­rec­tor, Chin­tels In­dia.

The Greater Noida Au­thor­ity has passed a pro­posal to in­crease the floor area ra­tio (FAR) of group hous­ing plots from 2.75 to 3.50, which was cleared at the au­thor­ity’s board meet­ing in early Septem­ber. In­creas­ing the pop­u­la­tion den­sity norm and FAR will en­able builders to con­struct more and help them cur­tail land costs. Once ap­proved, the au­thor­ity will al­low de­vel­op­ers to build 3.5 times of the ground area. What this means is that 350 flats can be built on a 1 lakh sq ft plot.

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