Authority officials said on Friday that of a total of 203 housing projects in the area, 65 are stuck and their developers need to reach a settlement solution under the new project settlement policy. They added that at least three realtors will exit from their respective housing projects as they have failed to begin construction at the site.
The project settlement policy is an umbrella policy that has multiple solutions for various builders.
Most of the developers whose projects are stuck were allotted group housing land in 2008-2010 and were supposed to deliver flats by 2012-13. However, they failed to deliver flats and clear land dues to the Greater Noida authority that provided them housing land on instalment basis.
Around one lakh homebuyers are affected by unfinished projects. According to builders, they are facing a fund crunch due to dip in sales.
“There are many reasons why realtors could not deliver and are facing financial issues today. First, there were litigations over land that delayed projects for around one or two years. Many inexperienced builders too came up and failed as they didn’t know the business. Many realtors also diverted funds collected from homebuyers. However, I hope things improve soon,” said Sunny Katyal, owner of Investors Clinic, a realty consultant firm in Noida.
On Thursday, Greater Noida chief executive officer Deepak Agarwal had held a meeting with 65 realtors to discuss issues pertaining to each project and asked them to submit a detailed project report (DPR) for each of them.
“These 65 projects face some sort of issues. We believe three will exit and eight need co-developers to finish the projects. The rest have pending land dues that they want extra time to pay,” said Janardhan Mishra, additional chief executive officer, Greater Noida authority.
Officials said a third of housing projects in Greater Noida are stuck for some reason or the other reason. Of these, if any realtor exits, their buyers will get their investment back instead of the promised flats.
In case of an exit, the authority will deduct 15% of the security amount deposited by the realtor against the housing land. If a realtor gets any balance amount, the authority will allot land for that amount.
“If homebuyers have made an investment in any project, including in these three, we will transfer the security fund into an escrow account from where we will help it reach investors,” said Mishra.
Amrapali Group, Unitech, Value Infra Group and Rudra Group, among others, took part in the meeting. Officials, however, refused to name the realtors who want to exit.
“A committee from an engineering department of the authority is conducting a survey on around 20 projects that we believe are stuck. Once the committee report is in, we will announce names of the realtors who will not be able to finish a project. We cannot name the realtors now because we are not sure of their projects’ progress,” said Mishra.
The authority said eight realtors have decided to introduce a co-developer to finish a project stuck midway. The co-developer will become a partner in a project and spend funds on completing it.
“We have asked all realtors to submit DPRs on their respective projects so that we can reach a solution. Most realtors want additional time to clear land dues so that they can finish the project. Each has its own issues. We will be clear once they submit their DPRs,” said Mishra.
The authority said that after DPRs are submitted and the engineering survey completed, it will announce the number of realtors who want to exit projects.
“The crisis in the Greater Noida realty market is an outcome of mistakes that took place in 2008 when the government allotted housing land even to those with no background in construction. Those who had funds bought land and came up with apartment complexes to make easy money. They sold flats cheap to lure buyers. They have failed to make profit and so are unable to deliver flats to homebuyers and land dues to the Greater Noida authority,” said RD Singh, real estate consultant.