Games bailout package hangs fire
With 21 months to go for the Commonwealth Games, the fate of the prestigious Games village, which has run into financial trouble, is yet to be decided, reports HT Correspondent.delhi Updated: Feb 16, 2009 13:39 IST
With 21 months to go for the Commonwealth Games, the fate of the prestigious Games village, which has run into financial trouble, is yet to be decided.
The village, coming up along NH-24, will accommodate 8,500 athletes and delegates who are expected to participate in the Games.
With Emaar-MGF, the Dubai-based real estate developer which bagged the project, sending an SOS to Delhi Development Authority (DDA) asking for a bailout, hectic parleys have started between the DDA and the developer to bail out Emaar-MGF, which is facing a financial crunch.
“No decision has been taken as yet. We are exploring various options to help the private developer complete the project on time. We might buy some of the flats from the developer. But nothing has been finalised as yet,” a DDA official said.
The government has already helped the project developer by rescheduling the repayment of a Rs 50 crore loan by nine months, that the developer had taken from State Bank of India.
Emaar-MGF had written to DDA in December that it is facing a financial crunch and sought a loan to complete the project.
Initially, the agency in a letter dated December 22, had refused a loan to Emaar-MGF on the ground that it is against a contract agreement.
DDA had chosen the public-private partnership model for the Games village project. As part of it the developer will not only develop the village but will also be responsible for selling off two-thirds (768) of the total 1,168 apartments that will come up.
The high-end apartments will be priced over Rs 2 crore each. Only a fraction of the flats — about 389 — will be sold by DDA after the Games are over in October 2010.
While the developer has been given the freedom to sell the flats at market rates, DDA will have to sell its share of the flats after the developer and that too at a pre- determined rate.
Emaar–MGF had planned to raise funds for the project through selling flats. As it did not find many takers, it requested DDA for a loan to complete the project. The developer had started bookings for flats back in June 2008.