With the Union government
planning to redevelop existing properties prime locations in the two metros
Mumbai and Delhi, the real estate firms here are set to experience another
boom.
In partnership with private realty firms, the centre proposes to overcome shortage in office and residential
spaces in these metros.It plans to demolish the existing single or two-storey buildings.In commercial and residential areas to build multistorey structures and
optimize the use of prime real estate in its possession. Real estate firms will
gain from residential flats or commercial space in the redeveloped properties.
They may also gain, from annuities, rental payments being considered by the government
in lieu of undertaking construction, financing and risks involved with these
projects.
The move will address to a great
extent the problem of steep property prices in the urban centers. The problems
of unaffordable housing prices can be effectively addressed by public-private
partnership. With this, the government would be able to add one crore sq ft office
space and 61,000 houses or flats in Mumbai. Another 43,000 flats would be made available for the Mumbai police. Similarly, 25 lakh sq ft office space and
34,000 houses would be developed in New Delhi to overcome shortage of residential
space for the government officials, ever expanding list of former ministers, members
of parliament and retired government personnel. Another 20,000 houses required
for the Delhi Police would be constructed on the existing real estate held by the
government agencies. The postal department also needs residential space.
The planning panel and ministries of urban development, railways, defense and finance are being consulted on this
initiative. The ministries of defense and railways may not be part of the move
to redevelop government properties. Though the three services army, air force
and navy are in need of residential and office spaces, the ministry will execute
its own plans, Excess land in cantonments would be utilized for this purpose.
Once the policy to
redevelop the government properties is finalized, a biding process will be put in place to select the partners for the projects.A model concession agreement
would set the normal and commercial terms under which the real estate majors will
participate in these projects. The government will extend the re-development of
its property in Chennai, Bangalore, Hyderabad, Kolkata, Ahmadabad and Pune.
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