A breath of fresh air for Delhi’s heritage zone
Ahaven of architectural excellence, Lutyens Bungalow Zone (LBZ) is an area which singlehandedly gives Delhi distinct recognition as one of the best capital cities of the world. Designed and built by British architect Edwin Lutyens and his team in the 1930s, this part of Delhi has maintained its imperial character partly, due to the governments of the day preserving its soul. However things are Set to change soon. As of today, LBZ covers approximately 3,000 acres, or approximately 1.5% of the landmass of Delhi. It has about 1,000 bungalows, out of which only 65 to 70 are for private use. The rest are reserved for use by ministers and other government officials. It is home to various government offices, the Parliament, the Presidential residence, India Gate and different types of bungalows for government officials and ministers. Designed with aesthetics in mind, the zone was kept intact and devoid of any new development for several decades, even as the city around it grew in leaps and bounds.
To maintain the sanctity of this location, strict rules were implemented: no high rises, no basements and no change in the construction of the bungalows and buildings in the entire zone. The result was massive inequality in the usage of land between LBZ and other parts of Delhi — and astronomically pricey real estate in LBZ even without the benefit of the latest facilities.
Areas like East Delhi have become densely populated and house as many as 1,100-1,600 people per acre of space. LBZ currently has only 14-15 people per acre. Lutyens’ Zone is in the heart of the city and has wide, green open spaces. Land here had always been in very high demand, despite the sky-high prices caused by the prevailing sale restrictions and limited availability of property for private use. In Lutyens’ Zone, sale or purchase of properties for more than ₹ 100 crore has been the norm over the past few years. In March 2015 a 2.4 acre plot was priced at ₹ 304 crore - one of the biggest ticket sizes for a residential plot in the country. About a year previously, the biggest sale recorded here was for a 2,290 square yard plot at ₹ 220 crore.
However, this massive sale happened after a long gap of almost two to three years. In the interim period such spectacular transactions were more or less put on hold. While there used to be 18-24 transactions every year three years ago, the past one year saw only 12.
India faced a slump in the economy during the second term of the UPA, with GDP growth slowing to 4.7% and the real estate sector seeing one of the worst downturns ever. The global economy too gave little reason for billionaires to splurge on trophy properties. Also, the Lok Sabha elections in 2014 also compelled people to sit on the sidelines and wait for the new government’s policies pertaining to the real estate sector and black money.
These were far from clear in the beginning of the new government’s term, and this caused a lot of reticence among those with the clout to engage in the kind of transactions which define property deals in Lutyens’ Zone. Thanks to the limited supply, prices here did not go south, but transactions were nevertheless held in abeyance as potential buyers waited for pricing to cool down.
This did have a negative impact on the market, and caused rentals to shoot through the roof. Many potential buyers became tenants instead, shelling out as much as ₹ 25-40 lakh per month for a bungalow. Today, however, Lutyens’ Zone’s property market is in for a major sea change.
In a city that is spreading out to accommodate more and more citizens, this potential freeing up of space in the heart of the city is obviously a welcome development. That said, such plans have been under discussion for many years, and successive governments have been visibly averse to taking concrete decisions despite knowing the benefits of such measures.
Freeing up of space in the heart of the city is a welcome development