Un­lock­ing Delhi’s land po­ten­tial

The Delhi op­por­tu­nity means im­proved qual­ity of life for its res­i­dents and af­ford­abil­ity through the Master Plan’s vi­sion of in­te­grated sub cities. The Cap­i­tal’s land sup­ply is likely to be launched at per sq ft to per sq ft in some of the new zones

HT Estates - - Front Page - Van­dana Ram­nani

The Master Plan 2021 en­vis­ages cre­ation of five new sub-cities within Delhi, big­ger than Dwarka and Ro­hini and with al­most 60,000 hectares to be un­locked for devel­op­ment or re­de­vel­op­ment. This in­cludes ar­eas in the green belt, ex­ist­ing unau­tho­rised colonies and var­i­ous farm­house de­vel­op­ments in south Delhi.

The Gur­gaon-Noida story was based on the premise of lack of avail­abil­ity of land in Delhi. Ab­so­lute short­age of land in Delhi forced peo­ple to look for op­tions in the pe­riph­ery. The new Master Plan is likely to change all that. What one knows as NCR (Na­tional Cap­i­tal Re­gion) could soon be re­de­fined as the NCT (Na­tional Cap­i­tal Ter­ri­tory).

New op­por­tu­ni­ties

For the unini­ti­ated, the Na­tional Cap­i­tal Ter­ri­tory of Delhi is di­vided into 15 zones as per the new Master Plan. Out of th­ese, A to H, P, M and K1 are in ur­ban Delhi and J, K2, L, N and P2 fall in what is known as ur­ban ex­ten­sion. Also, with the pop­u­la­tion ex­pected to rise to 2.36 crore by the end of this decade and the pro­jected hous­ing de­mand pegged at more than 2 lakh dwelling units a year (a re­quire­ment that government au­thor­i­ties may not be able to ful­fill), the new plan seeks to fo­cus on pub­lic-pri­vate part­ner­ships and has a pro­vi­sion that pro­vides for en­try of pri­vate de­vel­op­ers in the ac­qui­si­tion and devel­op­ment of ‘new’ Delhi land.

“We re­quire 15 lakh dwelling units by 2020. The government does not have the ca­pac­ity or the where­withal to ac­com­plish this task. Hence, the need for the pri­vate sec­tor to step in,” points out AK Jain, former Delhi Devel­op­ment Author­ity (DDA) plan­ning com­mis­sioner.

In­ter­est­ingly, sev­eral lead­ing pri­vate de­vel­op­ers have al­ready be­gun ac­quir­ing land in some of th­ese new zones. Pri­vate eq­uity funds are also eye­ing th­ese new op­por­tu­ni­ties be­ing made avail­able in Delhi.

The chal­lenges - what needs to be done

If im­ple­mented well, the Master Plan could turn out to be the big­gest real es­tate op­por­tu­nity of re­cent times. How­ever, the chal­lenge, say realty ex­perts here, is how soon the government fa­cil­i­tates the par­tic­i­pa­tion of the pri­vate sec­tor through clear­ances and level play­ing fields.

The im­pact- ra­tio­nal­i­sa­tion in prices

Real es­tate ex­perts are of the view that the new res­i­den­tial op­por­tu­ni­ties that the new Master Plan of­fers is likely to lead to ra­tio­nal­i­sa­tion of res­i­den­tial prices in the sur­round­ing ar­eas.

Delhi will throw up the largest sup­ply of hous­ing at all price points in the R10 lakh and over R1 crore price band due to the ad­van­tage as­so­ci­ated with buy­ing land cheap to­day. De­vel­op­ers and in­vestors who buy land now can af­ford to prof­itably pro­vide sup­ply in this price band.

Delhi will com­pete with ar­eas such as Gur­gaon and Noida. The largest de­mand lies in the mid- and af­ford­able hous­ing seg­ment. This is be­cause of favourable land pric­ing. The sur­round­ing mar­kets are cre­at­ing low­cost/af­ford­able hous­ing projects al­most 60-80 km away from the CBD ar­eas of Delhi, with low in­fra­struc­ture and trans­porta­tion con­nect. The Delhi op­por­tu­nity would im­prove qual­ity of life and af­ford­abil­ity through the MPD vi­sion of in­te­grated sub cities.

If one were to an­a­lyse the cur­rent real es­tate mar­ket sce­nario, one will find that while Gur­gaon’s and Noida’s res­i­den- tial prices have shot up, the huge land sup­ply in Delhi may see projects be­ing launched at R4,000 to R5,500 per sq ft in some of th­ese new zones due to tough com­pe­ti­tion.

There are two urabn ex­press roads that will con­nect th­ese new zones with the ex­ist­ing ur­banised area of Delhi. The first UER1 will orig­i­nate at NH1 and ter­mi­nate at NH8. UER2 is a 100 m road orig­i­nat­ing on NH1 and cut­ting through NH10, NH8. It will go up to NH2 and be the life­line of all th­ese new zones. This road has al­ready been ten­dered and con­struc­tion has started. It would be what the NoidaGreater Noida Ex­press­way is for the east­ern sub­urbs. Once the 100 me­ter UER2 is ready, get­ting to Ro­hini would just mean a 20-minute drive from the air­port and South Delhi. The two UERs should are likely to be com­pleted be­fore 2016.

Re­de­vel­op­ment po­ten­tial

MPD 2021 has a pro­vi­sion for the clus­ter block ap­proach wherein ex­ist­ing plot own­ers can pool in their in­di­vid­ual prop­er­ties and re­de­velop them into apart­ments with bet­ter ameni­ties and greater FAR.

For the unini­ti­ated, the MPD has pro­vi­sions to en­cour­age re­de­vel­op­ment through pri­vate par­tic­i­pa­tion – to re­de­velop ei­ther sin­gle units or through amal­ga­ma­tion. It also calls for vol­un­tary par­tic­i­pa­tive devel­op­ment in the ru­ral ar­eas. The clus­ter block ap­proach al­lows ex­ist­ing plot own­ers to pool in their prop­er­ties to ar­rive at the magic num­ber of 3000 sq m, the min­i­mum re­quire­ment as far as the size of the plot is con­cerned. Like­wise, for tap­ping into the land in the vil­lages, unau­tho­rised colonies and re­set­tle­ment colonies, the MPD en­vis­ages a pol­icy for 2000 sq m.

The Master Plan also seeks to in­cen­tivise the re­de­vel­op­ment process. “To in­cen­tivise and re­de­velop, a max­i­mum over­all FAR of 50% over and above the ex­ist­ing per­mis­si­ble FAR on in­di­vid­ual plots will be al­lowed – sub­ject to a max­i­mum of 400. Higher FAR shall not be per­mis­si­ble in re­de­vel­op­ment of Lu­tyens bun­ga­low zone, Civil Lines bun­ga­low ar­eas and mon­u­ment reg­u­lated zone,” it says.

The ben­e­fi­ciary would be the end-user who would get prod­ucts at the ideal price points, while the de­vel­oper would ben­e­fit from faster cash flows. The land owner ben­e­fits from cap­i­tal ap­pre­ci­a­tion of his land as­sets. Over­all, it’s a win-win sit­u­a­tion for all.

As per the scheme, re­de­vel­op­ment and re­newal is to be iden­ti­fied on the ba­sis of the pres­ence of phys­i­cal features such as the Metro, roads, drains, high-ten­sion lines and con­trol zones such as mon­u­ments and her­itage ar­eas. In short, this means that there should be ad­e­quate pro­vi­sion of in­fra­struc­ture and the area to be re­de­vel­oped should not be lo­cated close to a her­itage site.

As per the MPD, the government’s re­de­vel­op­ment ef­forts are tar­geted at unau­tho­rised, re­set­tle­ment and re­ha­bil­i­ta­tion colonies but are more likely to hap­pen in ar­eas where large con­tigu­ous plots are avail­able, places which may al­low for easy ag­gre­ga­tion of 3000 sq m land parcels. The state government has ini­ti­ated the process of reg­u­lar­i­sa­tion for 895 il­le­gal colonies in Septem­ber last year at one go. The state cab­i­net gave in-prin­ci­ple ap­proval this month to reg­u­larise 205 unau­tho­rised colonies that had come up on ASI and for­est land over the years in the city.

For reg­u­lar­i­sa­tion, in­fra­struc­ture has to be ex­tended to th­ese colonies and cer­tain lands would also have to be ceded to fa­cil­i­tate in­fra­struc­ture.

The new green belt

MPD 2021 en­vis­ages a num­ber of changes re­lated to the lo­ca­tion (in the green belt) and con­struc­tion of such types of prop­er­ties. Out of the 15 zones, A to H, P, M and K1 are in ur­ban Delhi and J, K2, L, N and P2 fall in ‘ur­ban­is­able’ area or ur­ban ex­ten­sion. The doc­u­ment stip­u­lates that land up to the depth of one pe­riph­eral vil­lage rev­enue boundary along the bor­der of NCT would be main­tained as green belt. New farm­houses will only be al­lowed in this green belt.

JASJEET PLAHA

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