The prestigious Commonwealth Games village project coming up along NH-24, where 8,500 athletes and delegates will be accommodated, seems to be in trouble once again.
Eighteen months to go for the 2010 Games that the Capital is hosting, Emaar-MGF, the Dubai-based real estate developer, which bagged the games village has written to Delhi Development Authority (DDA) saying it is facing a financial crunch and has sought a loan from DDA to complete the project.
In a letter dated December 22, the DDA refused loan to Emaar-MGF on the grounds that it is against the contract agreement.
The DDA had chosen a public private partnership model for the Games village project. As part of it, the developer will not only develop the games village but will also be responsible for selling off two third (768) of the total 1,168 apartments that will come up at the village.
The high- end apartments will be priced at over Rs two crore. 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 soon after the Games are over, DDA will have to sell its share of flats after the developer and that too at a pre- determined rate.
The developer has written to DDA saying it is finding it difficult to sell its share of flats.
“The developer has said that because of the ongoing litigation involving the Games village project, prospective buyers are not coming forward to book flats. So far they have managed to sell approximately 250 flats. As it is, the sale has been affected because of slowdown in the realty sector,” said a DDA official who did not want to be quoted because he is not authorised to speak to the media.
Emaar –MGF had planned to raise funds for the project by selling the flats. Because it is not finding many takers, it has requested DDA for a loan to complete the project. The developer had started booking flats way back in June 2008.
When contacted, Emaar-MGF spokesperson, however, said, “I am not aware of the letter written to DDA asking for a loan.”
“We have not started booking of all flats at one go. It is being done in phases. The sales are good,” he added.
A group of environmentalist led by Magsaysay award winner Rajendra Kumar had filed a PIL in the High Court challenging the construction on the Games village, as it is located on the Yamuna flood plains.
The High Court had on November 3 decided to form a committee headed by Nobel Prize winner and noted environmentalist R.K. Pachauri to study if the ongoing construction would have an adverse impact on the river bed.
“Though the Supreme Court had stayed these decisions of the High Court and given a go ahead to constructions, the litigation has driven away prospective buyers. As it is the sale has
been affected because of slowdown in the realty sector,” said the DDA official.