NOIDA: Three industrial authorities — Noida, Greater Noida and Yamuna Expressway — have approved an exit policy for sick realty projects, a move that will benefit both the builders and homebuyers.
The three authorities, in a joint board meeting on Thursday, resolved that realtors who have acquired land for a particular project can surrender it and get their deposit back, if they want out.
The policy was announced as realtors owe around Rs 25,000 crore in land dues to the authorities. Several developers have failed to deliver projects in Noida and Greater Noida due to financial stress. This has affected nearly one lakh homebuyers In Noida alone who have not got their flats despite paying the full amount.
The proposal will be sent to the UP government for ratification in the next 2-3 days.
“If a realtor bought 100 acres land for group housing or some other project and was not able to develop the entire land, he can surrender the remaining land and complete the projects that he had started,” explained PC Gupta, additional chief executive officer (ACEO) of the Greater Noida authority.
The Greater Noida authority had allotted 200 group housing land parcels to different realtors from 2006 onwards. As per an estimate 30-40 per cent land remained undeveloped due to dip in sales of housing units. In Greater Noida too, around 3.5 lakh homebuyers could not get flats that were to be delivered 2012 onwards.
“The authority will return 70 per cent of the deposit after deducting 30 per cent money. With the refund a realtor can complete another project, which is nearing completion. The three authorities will then allot the returned land by a fresh allotment process,” said Arun Vir Singh, chief executive officer (CEO) of YEIDA that owns 165 -km Yamuna Expressway.
YEIDA had allotted group housing land parcels to 13 realtors along the Yamuna e-way in 2009-10. Seven of the 13 developers are unable to develop the group housing land because of lack of buyers, said officials.
“These seven realtors have land parcels as big as 40 to 100 acres. If they will surrender the land then the authority will allot it to new developers,” said Singh.
The Confederation of real estate developers association of India (CREDAI), a realtors body, welcomed the exit policy proposal.
“It is a win-win policy for both the developer and the home buyers. If a realtor has 50 acres land and he could develop only 10 acres then as per the new policy he return 40 acres. He can then invest the refunded money into the projects that he had started. Buyers will be benefitted since there will be no delays,” said Amit Modi, director of ABA Corp and vice-president CREDAI (Western UP).
The authorities will not take back land if buyers have invested in it.
“The government should implement the policy without further delay. It will help majority of buyers who have invested in projects in Noida and Greater Noida,” said RK Srivastava, a homebuyer.