Q. Has Oberai Realty not obtained any loan or financial facility/arrangements from LIC Housing Finance?
Ans. No, absolutely not. No form of loans has been obtained from any financial institution. Oberoi Realty is a ‘zero-debt’ company. All loans that we had taken five years back, have all been duly repaid by the last two years. There is no outstanding loan.

Q. If yes, what types of arrangements were entered into? If no, then to what extent has LIC Housing Finance Ltd. financed your customers to acquire flats in your projects?
Ans. We do not have a clear picture as to what extent LIC Housing Finance Ltd. has sponsored our customers. But, from the Company’s side I can assure you that we have no outstanding loan with LIC Housing Finance Ltd.

Q.The land that you have purchased in Goregaon, what was the source of funds for that purchase? Has any financial institution sponsored you to acquire the land?
Ans. I do not have a clear idea about that. Kindly refer to the Red Herring prospectus on the SEBI website, for elaborate details.

Q. Some portion of the three towers that Oberoi Realty has constructed is in forest land, according to reports. How far is this true?
Ans. Yes, there were minor legal issues associated to those constructions in Mulund. However,we have recently received Government approval for those projects. All litigation has now been put to rest.

Q. Why has there been a delay in projects on the Jogeshwari-Vikhroli Link Road?
Ans. Yes, there has been a delay in completing the project. I do agree we have been running behind schedule, but there hasn’t been an huge delay either. We were expected to deliver the project by December, this year, instead of which we are now delivering my the next quarter of the financial year, that is by March-April. We have just fallen behind by 3-4 months, which considering the present scenario of exorbitant project-construction delays, is pretty acceptable & justified.

Q. What is the pattern of deployment of funds from IPO?
Ans. Our current financial status, as it stands at present is as follows:

We are having a total fund of Rs.1500 crores with us.
Of this total fund amount of Rs.1500 crores, Rs.1000 crores has been raised through IPOs.
The remaining Rs.400 crores is reserved in our bank account.
The total amount of Rs.1000 crores generated from IPOs, has been invested into the following heads:
a).Construction activities-Rs. 741 crores

b).Land acquisition ventures-Rs.225 crores

c).General corporate plans- The remaining amount of Rs.34 crores.

We need to confirm the above with finance department about the exact position.
As spoken to Indrajit Sen, Sub-Editor, Accommodation Times.

Ref: WORLD CONFERENCE ON “REMAKING OF MUMBAI” ON 3rd TO 5Th FEBRUARY,2010 BY THE “REMAKING OF MUMBAI FEDERATION”(ROMF).

SUB: (a) Strong objection to anyone of “Remaking Of Mumbai
Federation” (ROMF) intermeddling with Private Properties.
Encourage Property Owners to redevelop properties, small clusters, involving 5-10 buildings.
Discourage large clusters, involving demolition of 600/800 or odd building as suggested by big developers and by ROMF

Respected Sir,
On behalf of The property owners Association( which was established in 1924), we wish to submit as follows:

THE VISION OF THE PROPERTY OWNERS ASSOCIATION IS AFFORDABLE HOUSING FOR ALL; A HOME FOR OUR PEOPLE; A GLOBAL CITY OF DISTINCTION & MAKING MUMBAI A DREAM DESTINATION
In EIGHT Special General Meeting In 2 Years the property owner passed unanimous Resolutions to undertake redevelopment of their properties and rehouse the tenants & occupants. The said Resolution which was duly signed by its members present in the meeting have been submitted to the state of Maharashtra. More than one thousand owner are ready to forthwith undertake cluster Redevelopment proposal in the Island City of Mumbai. The right o the owner to redevelop their properties vest in the Owners only and the Property owner strongly object to anyone intermeddling with their properties INCLUDING STRANGER DEVELOPERS including the Remaking of Mumbai federation. All the owners are ready and willing to redevelop their properties.

The properties owner Association (established in1924) and representing the property Owners of Mumbai is strongly opposed to the move by the Authors of Remaking Of Mumbai Federation who was canvassing for demolition of 600-700 building in Chira Bazar / Kalbadevi area of Mumbai. The scheme propounded by them is totally impractical and will raise a tremendous hue and cry against the Government by the affected parties viz. the commercial and residential occupants and the owners of the properties.

The attempt by some builders, developers, the Remaking of Mumbai Federation and others is an exercise to pressurize the Government, through MHADA/ MCGM, to handover private properties for their development and Snatch which would be entirely unconstitutional and violative of the owners right interalia to develop their own property
We submit that-
Cluster proposal in the guise of remaking of Mumbai put by third party developers without the Property Owners consent is not lawful.
This is a move to deprive the property owners of their valuable properties running into crores of rupees for a pittance and to fill the coffers of the Developers.
Remaking sustainable Cities in the vertical age cannot be achieved by depriving the owners nor can it be at the expense of the property owners. It can only be achieved with the help of private property owners who should be permitted to undertake development of their respective properties.
Property owner Association strongly object to any presentation at the world conference of private properties in the name of Remaking Of Mumbai especially as the same is without the consent of the Owners.
Property matters for acquiring properties by MHADA / Government pending before Hon’ble Supreme Court of India before the bench of Nine Hon’ble Judges the interim orders passed earlier therein is in force any act contrary to the orders of Hon’ble Supreme court would amount to the contempt of hon’ble supreme court orders.
Person indulging in misguiding & putting cluster proposals on private properties liable to face Legal Civil & Criminal actions.

5. In 39 years (from 1969-2008) the Government , through MHADA, has only reconstructed only 442 building out of 19642 old buildings in the Island City. We strongly object the move of permit MHADA/ MCGM / Developers to overtake our properties in the name of Urban Renewal Scheme/ “ CLUSTER DEVELOPMENT” for development under DCR 33(9) and the property to be handed over to the stranger Developer for redevelopment and or stranger developers under the name and style ”Remaking Of Mumbai Federation” etc.
“The Remaking of Mumbai Federation” have an evil desire to acquire private properties at peanuts and by putting undue pressure on individual property owners. So as to fill their coffers at the expense of the property owners.

6. The property owner themselves are ready and willing to undertake redevelopment of Mumbai and convert Mumbai in World class City” and more than 1000property owners have already initiated the process of reconstructing Mumbai by rehousing of the tenants / occupants as per Rules under DCR 33(7) or DCR33(9).

The Remaking Of Mumbai Federation is proposing Remaking of “C” Ward, Chira Bazar ,etc. and want to conduct a technical tour of the “C” ward of international dignitaries,( attending the world conference organized by CTBUH and the remaking of Mumbai federation). The property owners strongly object to the said move by the Remaking of Mumbai Federeation to create and replicate projects on private properties for the development of Island cities of Mumbai. We deny that the Island of Mumbai contains over 32000 dilapidated buildings constructed prior to 1940 having population 2.5 million. We deny that the people are still living in their houses under the shadow of death.
The claim of Remaking Of Mumbai Federation that they have taken up the Herculean task of creating the WORLD CLASS MUMBAI utilizing redevelopment of old and dilapidated building in the Island of Mumbai is false and utopian statement. The said Federation has no right, title or interest over the said building which vests solely with the property owners.
The old building belonging to the Government can be taken up with the approval o the Government, as envisaged in the brochures, but definitely private property cannot be snatched away from the private property owners unless they sell their property to the Remaking of Mumbai Federation.

SUGGESTIONS:
We suggest the following:-

(A) BIG CLUSTERS INVOLVING LARGE SCALE DEMOLITION OF 600/800 BUILDING SHOULD BE AVOIDED:

The property owners strongly object intermeddling in their properties by stranger developer “Remaking of Mumbai Federation” or any other Developers of Builders.

The proposal are being floated by interested parties for large scale demolition of building numbering over 600-800 in grab of redeveloping Mumbai- widening the roads and leaving plentiful open space etc.
We strongly feel, such large scale demolition are totally impractical and it will create tremendous hue and cy against the Government and lead to untold suffering and misery of the occupants and owners whose building are targeted to be demolished.
Moreover, the large scale demolition envisaged would totally disrupt social and economic structure of the area where such large scale demolition are envisaged.
It will be appreciated that it is impossible to ask the occupants of such large numbers of building to vacate their building or even to relocate them without causing untold & undue hardships.
The area suggested for big Cluster development are mostly commercial area. The occupants will never like their business to come to a standstill. Immediate arrangement will have to be made for continuing their business uninterruptedly, which is not possible on such a large scale of demolition. The persons who are carrying o business have built goodwill over several years, which cannot be disturbed.
Background o the developers of the cluster developers needs to be properly scrutinized. The name of Shri Sukhathankar, Property owners Association have been flourished without their permission and they had to come out in the press that they have never consented to the schemes projected by the Remaking Of Mumbai Federation (ROMF).

ENCOURAGE SMALL CLUSTER BY OWNERS OF THE PROPERTY:

We are one with the Govt. that to ensure wide roads and open spaces high rise buildings would need to come into existence.
(a) We strongly feel that the only practical way is to encourage Property Owners to undertake small clusters of 4-5 plots or thereabouts. The owners thereof should come together and replace the old buildings by one/ two high rise towers etc. this would be much easier to achieve without creating a hue and cy and would not demolish the social and economic structure of the locality. Such projects would yield result much faster and could be easily achieved if proper incentives are given to the owners. The owners of all neighbouring buildings would come together and develop one or more high rise towers. The slogan should be “Go Back and Go High”.
Depending upon the area, Govt. should insist that after such regrouping, the towers should be at least 10 ft. away from the road and go as high as possible.
OUR MEMORANDUM DATED 8.1.2010 & 20.1.2010:
We have already submitted memoranda dated 8th January 2010 & 20th January 2010 for amendment of DCR 33(9) & DCR 33(7) and if our suggestions are implemented , the redevelopment of the Island City would be very fast and we would be able to convert Mumbai Island city into ‘World Class City’ in next 10 to 15 years.

Thanking you,

Yours Truly,
For THE PROPERTY OWNERS ASSOCIATION

Maharashtra Chamber of Housing Industry (MCHI): Mr Pravin Doshi, President, Maharashtra Chamber of Housing Industry (MCHI)
“The realty sector, the backbone of the Indian economy, began to revive in the year 2009 and has sustained the trend throughout the year. The rising demand for affordable housing spread gradually to such other segments as retail, hospitality and commercial properties. The demand for commercial properties has steadily grown in the second half of the calendar year and shows good promise for the year 2010.

Banks proactively reduced interest rates on housing loans, which provided the necessary boost to the realty sector. The MCHI held special exhibitions for the first time during 2009 to promote properties in the central and western suburbs of Mumbai and the response was amazing.

Overall economic conditions started improving and the confidence which was lost in view of global uncertainty, has started building a better foundation. The job market has also witnessed revival as the economic and political stability at the centre and state played a crucial role in bringing cheers to the economy. Going by the trends, we can say that it augurs well for the real estate sector in 2010, as growth is now unstoppable.”

Marathon Group: Mr Mayur Shah, Managing Director, Marathon Group
“The 2009 has turned out to be one of the best years for the realty sector. The realty sector, which is the backbone of the Indian economy has seen revival at the beginning of the year and maintained the recovery throughout the year. The demand which was seen in the affordable segment initially spread to the other segments such as retail, hospitality and commercial gradually. It is indeed a good thing that commercial properties witnessed some demand in the second half of the calendar year and we look forward yet another bright year for the real estate sector in 2010.

One of the most important factors that played a key role was revival in the economy that aided the uptrend in the realty. For Marathon Group, the success of affordable housing project — Marathon Nagri (Badlapur-Thane), Marathon Monte Vista (Mulund) catering to the mid-income and high end customers respectively and Marathon NextGen Innova (Lower Parel) unveiling the small-business-spaces (SBS) towards Banking, Financial Services and Insurance sector emerged as successful projects with overwhelming demand from the customers throughout the year.”

Wijin Joe, Bur Dubai, UAE
I have been a resident in Dubai for the past 26 years. I have spent all my life here in this Arab land. I do agree that the credibility in terms of investment has been lost at present but the setback is temporary. The media here is giving a better review of Dubai for years to come. There has been a crisis all over the globe and it has affected the United Arab Emirates too. I do not agree with those doomsayers who have been portraying Dubai as a crisis hit nation. The global economy is affected with the crisis and Dubai is a part of it hence it’s facing the brunt. It is true that Dubai played high stakes and by sheer misfortune got their fingers burnt very badly.
But as an expatriate who has been living in this country for years, I believe UAE, both nationals and expatriates will come out of this crisis wiser and stronger build an identity. Dubai World may have sunk, but the media around the globe especially the Western press has caused this chaos as they cannot compete with the development and growth of Dubai over the last decade. A little envy has triggered this fact.
If Dubai World has a debt of $80 billion, USA owes the Federal Reserves more than 11 trillion to the Federal Reserves. I feel that a developing economy goes through such phases and they will recover smartly out of all of the things being said.

Chrisell Rebello, Al Nadha ,Sharjah
What goes up will go down. Dubai’s aggressive and lavish construction sector is grinding to a halt. Thousand of Asian laborers have lost their jobs overnight and are forced to return home. Real Estate giants, namely Nakheel and Emaar are believed to have stalled various projects due to the crash. However all of this does not seem to be affecting all the expatriates, except for the ones under construction sector.

Nitin Venugopal, Ghusais, Dubai
I don’t think Dubai will loose its credibility as an investment destination. No other country has given a year-on-year growth in terms of Return on Investment in the last five years compared to what this country can offer. Moreover, the whole media barrage is about one company alone, whereas Dubai became what it is because of it being a logistical hub to the Middle East. It is like a gate to the Middle East for a lot of companies and that has not been affected widely.
I am sure that the amount of money invested in, say, the hope of 300% return will now only generate 15-20% return. You can look at this from a correction perspective if you like. But you cannot disregard the fact that there will still be returns.

Sujit John, Ghusais, Dubai
Wasn’t a recent ‘crash’, more like a ‘hyper activity’ by mostly non-local media? The flip-slide of the coin would be the terrible timing on the part of Dubai Word in announcing the repayment extension. The three days of Eid holidays allowed for frenzied speculation and doomsday prophecies.
The reality is; Yes, Dubai’s image has taken a beating as a financial destination…for now. But what needs to be remembered is that Dubai has been the commercial hub of the Arab world for many years, that too with less than 10% (of its GDP) dependence on oil wealth. And this was possible only because of a very stable and sound commercial climate which the Emirates provided. The government’s response of the separation of state and state owned business is a clear indicator of this ‘commercial’ view point. That means any business; whether state owned or otherwise should be based on sound business models and hence should be self sufficient.
However, ‘complete transparency’ in commercial dealings is an alien concept here. Anyone who has conducted business in this part of the world will know that. And he will also know that it doesn’t matter when he sees his business flourishing!

By Mahesh Mudda, Chairman of Builders Association of India and ED & CEO of New Consolidated Construction Co. Ltd.

When we talk of Urban Transport, we are mainly talking about the situation of Public Transport in Metro cities like Mumbai, Delhi, Bangalore, Chennai, Kolkata, Ahmedabad, Hyderabad and Pune, or basically we are talking about the present state of affairs of these cities as regards their public transport efficiency, adequacy and affordability.

When it comes to Urban Transport or Urban Public Transport efficiency, the name that naturally pops up in mind is Mumbai – the city which has the most efficient integrated Public Transport system, compared to any other city in India. What is more creditworthy to achieve this distinction are the odds that are placed against this city – Most populated city in India, highest density of private vehicles per thousand population, maximum distance covered per trip, city with infrastructure that is bursting at its seams, city with highest percentage of public transport usage and above all a city which has the highest number of outside influx per day compared to any other city in India.

So what makes Mumbai’s Public Transport system most efficient?

Integration

Mumbai has the best integration of rail and road public transport. It also has a very healthy mix of private and public transport. So instead of competing with each other all three modes of transport compliment each other.

While the suburban railway takes the maximum load of daily commuters (more than 70%), the road takes the balance load shared between buses, taxis and autos that are available for public transport (around 20%) and the rest is taken by privately owned vehicles.

Upgradation

Mumbai’s transport system has consistently evolved with the passage of time and has tried to keep pace with the increasing population and speed of commuting that is required.

Trams were replaced by single and double decker buses, old steam trains were replaced by electric trains first, then by 9 coach rakes and now by modern 12 coach rakes of latest designs, old taxis and autos gave way for modern CNG vehicles. And Mumbai is still upgrading – it will soon have modern metro rail and mono rail for east west travel.

Infrastructure

Like the vehicle upgradation, there was upgradation in basic infrastructure too. Old railway wooden slippers were replaced with concrete slippers, old manual signalling system was replaced with modern automatic signalling system, old coaches were replaced with modern forced ventilation coaches, old manual ticketing system gave way for modern computerised ticketing system, passenger handling system at railway stations also underwent changes like underground entry and exits, direct access to skywalks etc.

Similarly on road transport new flyovers were constructed, concretization of roads was completed for major roads, roads were widened, pedestrians walkways were created, dedicated bus corridors are being created, new elevated roads are being constructed above the existing roads to create parallel traffic handling on arterial roads, improved synchronised signalling system for creating uninterrupted flow of traffic and many such improvements in infrastructure have helped tackle the increased traffic density on Mumbai roads.

Maintenance

Mumbai has not only integrated its rail and road traffic system, upgraded and modernised its vehicle fleet, taken huge strides in augmenting its infrastructure but has also very efficiently managed and maintained its resources in peak operating efficiency. Very rarely you will see a bus under break down on road or train stalled on the tracks. Rickety taxi or auto rickshaw that you sometimes see broken down on the road gets repaired or moved / towed away efficiently before they start affecting the traffic flow.

Discipline

However what really makes this efficient public transport super efficient is the discipline with which everything functions – on tracks as well as on roads. Trains observe their timings, buses utilise its full potential and ply from one end to another end at maximum permissible speed, Taxis and autos though violate traffic rules some times are quickly brought to books thus creating a fear about Mumbai’s law enforcement agencies, pedestrians observe the discipline on roads and rarely brake it on tracks, those responsible for keeping these objects of mass movement moving all the time do it as if it is their religion. But above all there is no denying that this happens because one dominating spirit of Mumbai – Every Mumbaikar knows that if ‘Mumbai moves India improves’ – No odds ever come in its way to reach its place of destination.

Affordability

Those who govern Mumbai’s public transport system know it very well that to make it efficient, people must use it first. That is the reason Mumbai’s public transport system is one of the cheapest in the world. Every time there is increase in public fares, there is also corresponding improvement in the services offered to offset the effect of fare increase. The operators of brand new Bandra Worli Sea Link have also quickly realised this and has decreased the toll charged by 20% within the first month itself of the sea link being thrown open to the public.

With increasing urban population all over India, Mumbai’s case today is going to be other metro cities case tomorrow. If all these cities emulate the example of Mumbai and its discipline the “Life in a Metro” will be lot more easier.

Sunny Bijlani, Director, Supreme Universal

Recognized for upscale designs in the best locations and an organization committed to customer satisfaction, Supreme Universal believes in building excellence that nurtures quality in all it undertakes, creating innovative projects that deliver value to clients.

Obsessed with utmost luxury and lifestyle since 1982, it has been a core value of the organization to set the highest standards of quality in the industry. The young and talented directors at Supreme Universal are the ones who along with the founders are responsible for growing the company by many folds in the recent past.

Responsible for developing some of the most luxurious and sought after residential properties in Mumbai, the organization took its operations to Pune in early 2001 and developed commercial as well as residential projects, which have been considered a hit with the young IT generation.

Sunny Bijlani, Director, Supreme Universal, is a part of formulating strategies for future expansion plans of the group. A management graduate specialising in finance and with a professional background, which included a stint with Axi Risk Consulting (then part of the Ambit RSM Group) he takes time off to share his views with Accommodation Times.

Can you shed some light on Supreme Universal for us?

The company was established in 1982. We started off with residential properties for the western suburbs. In 2001, we diversified our operations in Pune. Our dichotomy of projects is settled mostly in Mumbai, say around 80 per cent. The remaining is in Pune. We are primarily into the residential segment. 90 per cent of our projects are in this category. In Mumbai, we have projects in Khar, Bandra, Powai and Chembur.

What is unique about the services you provide? What sets you apart?

We cater to the luxury end, super premium segment. The amenities that we offer are a notch above the rest. In Chembur, for instance, we have provided with amenities like a car lift, a garden within the apartment and the works of a luxury apartment. We have international architects involved with our projects. Apartments are polished stressing on finishing and quality. All a home owner has to do is get his furniture and his clothes to move in.
We also focus on energy efficiency, something that has caught on recent times. So we have options like double glazing for windows for example. We focus on planning, engineering and design. Practicality is also a key. We look at aspects like wind direction and the way the light enters an apartment. In this regards, the floor part is imperative and we have no compromises when it comes to finalizing the floor plan.

What projects have you been involved with?

We have currently 2 million sq ft under our belt. We have Lake Homes in Powai which is a mini-township. We have projects in Khar and Bandra. We have launched projects in Pali Hill and Colaba, both of which provide sea-views. We are also in Union Park in Chembur. As you can observe, we are involved in prime locations and offer premium apartments. In Pune, we have half a million sq. ft which marks our presence there.

How have you coped in the recent fiasco of the realty sector?

We are a zero debt company. We have a sufficient amount of working capital. There will never be any serious impact for anyone who is well leveraged. I mean there are no interest payments to worry about, etc. So we are well managed.

To stimulate the realty sector what measures do you suggest? What should be the role of the government in such a time? Your views.

First and foremost, credit should be made easily available. Secondly, and more importantly, there should be a regulatory body with a single window clearance. The costs and time involved in obtaining various approvals and clearances is very high. A single window clearance can keep this in check and ensure a smooth flow of operations. There should be fixed rules and regulations for approvals. There is too much subjectivity which results in a corrupt state of affairs.
The government should also real locked land. This will create supply and meet demands in a better manner. Infrastructure is also a key which will ensure that metropolitan cities like Mumbai can breathe well.

Is the recession finally over? What indicators justify your response?

The worst is certainly over and sentiments have definitely improved. However, in the industry, prices are rising slowly and steadily. And this is coming at a time when prices have to be in line with an affordability index. The developers need to be sensible in these matters and check their rates as per the current economic climate.

What are the biggest challenges that are faced today?

The biggest challenge in the industry today is deals with clear titles and affordability. Another consideration that has been turning a few heads is that development of buildings should not harm the environment. For us, there has been a significant growth at the moment and we have to scale up accordingly. We are trying to make a solid foundation in order to match our growth.

What, as per your views, is the impact of the Dubai crisis?

In the long term, I do not feel that there is a negative impact as such. When it initially happened, the sentiments took a dive for a day or two. It affected the stock market a bit and the export industry has taken a whip, but beyond that it has not really affected this country. Non-Resident Indians (NRIs) settled there may have to come back home and this can lead to investments here. India may stand to benefit due to this, especially the realty sector, as it is an ideal investment avenue for investments

How do you see the outlook for India in 2010?

2010 will be a stable year. People will be looking at revenues and numbers closely. It will not be a year of upward movement where property prices are considered. There will be market forces that will thoroughly resist such an incident. With inflation also shooting up, it will tighten liquidity in the economy. But when the Reserve Bank of India (RBI) intervenes and sets off for equilibrium, spending power will increase. 2010 will be year for consolidation, a year of damage limitation.
When the spending power improves 2011, will be a year to lookout for.

By Anuj Puri, Chairman and Country Head, Jones Lang LaSalle Meghraj

There are two real estate markets to consider in this situation – the one in India and the one in Dubai. There are four factors involved in the Indian real estate market – demand, supply, finance and sentiments. At this stage, sentiments due to the collapse of real estate in Dubai are the most vulnerable and may get hit, while demand, supply and finance in India will remain untouched.

What is happening in Dubai is a corporate default situation involving Nakheel and Emaar. However, the Sovereign has not defaulted, so the condition is presently restricted only to real estate. This would not have a major direct impact on India’s real estate market, which is largely locally driven. Nevertheless, it is conceivable that the RBI may take a cautious approach in terms of liquidity in the real estate sector, which would not be good news in light of the fact that FDI norms for Indian real estate are on the verge of being relaxed.

It was evident that Dubai’s real estate market was not long-term sustainable, since it was not driven by end user demand. For a long time now, a multitude of apartments there have been standing unsold, held largely by speculator / investors who had bought them to sell them at higher prices that never happened. The big question now is how many of these investors have the ability to service their mortgages.

There would be real danger on a global scale if the Sovereign defaults, in which case everyone – India included – would face issues. However, any kind of specific predictions would be premature at this time. The next few weeks will reveal whether the Dubai situation will stay at the corporate default level, or whether it will escalate into Sovereign default.

Today the financial capital of India is one of the most densely populated cities in the world. In the last ten years, there has been an estimated influx of 1.2 million people in the city from across the country. The next population census will be in 2011 and the population count pegged then would be expected by statisticians to be in the vicinity of 15 million. Although, it would be no surprise that it may cross that mark by a mile.

The World Bank should not only consider a crammed suburban rail coach at peak hours to be violation of human rights, but also the very living conditions of 40 odd per cent of the population living in slums as a human right violation.

An estimated 12-15 per cent of the rich and the super-rich occupy the island city. In reality, a mere 6-8 per cent of the island city is slum. It can be further summed up that the entire city of Mumbai with its extended suburbs amounts to 15 per cent of slum expanses. In contrast, the Financial Times states that, “Dharavi is the Grand Panjandrum of the Mumbai slums”. Now imagine 40 per cent of the population marrying 12 per cent of the space, and it results in chaos that we give as dowry to the city. An estimated 30 per cent of the great Indian Middle class are either in chawls in the island-city or have moved to the distant suburbs in search of “better amenities” that pumps up the crowded coaches.

On 24th November 2009, the new Minister of State for Housing (Maharashtra), Sachin Ahir has come up with a novel idea of black listing builders who have not fulfilled their time-bound promises under the Slum Rehabilitation Authority (SRA-1996), for a slum-free Mumbai.

What is disappointing is that the passing of the Bill in the Legislative Assembly pressing for only one recognized committee in a particular slum, which means if 70 per cent of people agree to a certain project (which is now in place as well), the voices of the other 30 per cent will be quelled and culled. And they would not even be heard if they have a registered committee. One will conclude that 100 per cent of the people will be governed, monitored and arm-twisted by the Minister’s men within the 70 per cent.

Actress Nandita Das says, “A corrupt Democracy is better than having No-Democracy” which we fortunately have. Albeit a corrupt and fragile democracy. As Voltaire says “I may not agree with whatever you say, but I will defend your right to say till the last drop of my blood,” and the minister should listen to Voltaire.

Ideally the Minister should be pressing for a two-party system, instead of passing the above Bill. This is imperative so that we do not have King-makers and Queen-makers and have cleaner and efficient governance, affordable housing and much more.

This is not a screaming declaration of the “Murder of Indian Democracy”, especially since it is suggested by a tax-payer. It is neither anti-rich nor pro-poor because the poor brethren are robbing the city for their free consumption of electricity and water and making the pavements their ‘legitimate’ home.

As the Mahatma says, “There is enough for everyone’s need but not for one man’s Greed”. You don’t need to be an Economist or an MBA to understand that business is business, keeping in mind that only the core 10-15 per cent who can buy the builder’s duplex accommodations. Greed has made our political classes lack the will because if they want they can put the government machinery into place, so as to provide affordable houses, and making those robbing the city accountable.

Under whatever Scheme or No-Scheme, there is still 50-60 per cent of the great Indian upper or lower-middle class which the developers can cater to from the profit point of view. Profit through volumes. More onuses should be put on government authorities like Maharashtra Housing & Area Development Authority (MHADA) and City and Industrial Development Corporation of Maharashtra (CIDCO) for such Housing facilities. There is a need for an honest regulatory body with teeth created to look into construction of new affordable homes; so that no sub-standard houses are built in addition to “no” or “minimal amenities” and we can opine and read titles such as “Maximum City; Sufficient Housing”, if not “Maximum City; “Maximum Housing”.

By Keshav Morab

The property market saw a boom all over and property rates touched the sky, making it impossible for the common man to think of buying any property in Bangalore. Seeing the sudden boom in the real estate market, many developers entered the property market in Bengaluru, considered to be the fastest growing city in the country.

Yes, Bengaluru is a fast growing city as may be seen from the launch of major infrastructure projects, such as construction of flyovers, widening of major and important roads, construction of grade separators, under passes, Metro rail, Monorail and many more. This has resulted in the city growing in both area and population.

The area which was just 250 sq. kms is now almost 900 sq. kms. The population which was about forty lakhs is now about eighty lakhs. In view of the vast area consisting of about 110 villages, city municipalities and one town municipality coming within the city area of Bengaluru, it has formed the city into Brihan

Bangalore Municipal Corporation. The entry of number of multinational companies, and IT, BT companies has also been attributed to the growth of the city in the past two decades.

The growth has attracted young job seekers. Many educational institutions have been established in and around the city. Educational institutions are open for students not only from various states but other countries too. All these have attributed to the sudden growth of population. Bengaluru is now considered to be a destination for investment in trade and industry.

The growth in population has automatically increased the demand for space in both commercial and residential sectors. Most of the owners of residential properties in Bengaluru are extending their properties by constructing many floors in the hope of getting good rentals. To some extent this trend may meet the demand for residential space albeit to a very small extent.
During the recession, there was some setback in the real estate market, particularly in the past two to three years. There was a down trend in the market. The situation is now changing slowly. The demand for space, commercial and residential, is quite high now. Developers who have developed their properties were not able to sell flats or commercial space will now be able to dispose off their properties and may stand to benefit. The developers who are ready with their completed projects are offering various benefits like concessions in prices, provisions of swimming pools, clubs, gyms, small markets, gardens, playgrounds, etc within the project area. With these concessions and facilities buyers are now expected to start investing.

The recession, no doubt, has affected the real estate industry, particularly in the construction sector to a large extent. Buyers were forced to defer investments in properties. Consequently, a large number of vacant flats were available in the city. The high-price factor during a recession must have certainly deterred buyers from investing in properties. The situation is now slowly changing and developers are expecting a change in the mindset of buyers. The high demand for residential accommodation has given hope to developers to sell properties. The present situation seems to be quite favorable for the middle and higher middle class in particular to invest in property.

The change in the real estate market is due to various reasons like commuting to key areas in the city, commercial development in all the areas, good social infrastructure, rapid industrial growth, opening of various avenues for job aspirants and so on. The authorities have realized, although late, that the basic need for infrastructure in all the localities have to be met expeditiously and are now responding to most of the demands.

Now that the infrastructure development activities are in full swing and the property developers too are providing some of the basic infrastructure needed within their project areas, Banks are offering in the required funds in the form of long term loans. It is hoped that the common man would come forward to invest in the properties.

Real estate pundits feel that now is the time for accommodation seekers to invest in properties and that the opportunity should not be lost. The real estate market now seems to be steady and investment friendly.

In individual segments, value retailing has fared better than luxury retailing.

Quick Service Restaurants (QSRs) are doing brisk business in Malls and revenue share was increasingly adopted as a preferred form of leasing agreement by retailers.

The National Capital Region of Delhi continues to be the leader of mall culture in India, contributing nearly 50% of all organised retail stock across seven major cities (Figure 1). During the recent slowdown, malls were the worst hit with a high churn rate of tenants and deeper correction in rentals of 50% as compared to 27% for the high street.

The reason for this is twofold. One, most of the high street retail space in India is owned by occupier/investor at historically low prices, making this market more accommodative to rental pressures.

Two, retail space at high-streets is low and therefore relatively scarce, as compared to malls which account for almost all new supply additions over the last few years.

Following are some of the key trends exhibited in Delhi NCR, Mumbai and Bengaluru in the last few quarters.

• The share of Exclusive Brand Outlets (EBOs) in organised retail space has shrunk across NCR and Bengaluru. However, EBOs in Mumbai recorded healthy take-up, nearly the same as that of 2008.
• Most large retailers have put their expansion plans on hold while some have consolidated their exposure by closing down loss making outlets. With the economy and disposable income stabilizing, DTZ do not expect this trend to accelerate in future.
• Amongst individual segments, value retailing has fared much better than lifestyle and luxury retailing, with most exits happening in the latter category. While this was the broader market trend, Delhi NCR had some exceptions to this trend e.g. Square One Mall and DLF Emporio in South Delhi which continued to do well with more lease deals happening.
• There was a clear trend of the rising share of Food and Beverage (F&B) as a product category. The preference of the end consumer has shifted to affordable eating places, triggering a rise in the Quick Service Restaurants (QSRs) outlets.
• The trend of revenue sharing gained wider acceptance across cities, both amongst developers as well as retailers. Under this model, the retailer pays rentals to the developer as a percentage of his sales/revenue during a period, instead of a fixed rent every month. This enables the retailer to incur real estate costs commensurate with the level of business activity during a period.

DTZ believe the shift in the retail space occupation trends, its consolidation and softening of leasing terms in favour of the occupier/retailer are positive steps towards the long term sustainability of the sector. These, together with effective mall management are expected to bring more sophistication to the sector.